Forum Replies Created
Of course, you can be like all the failed sharetraders and write an online course, sell for $500 and keep the lot!
(Oh I am cynical aren’t I[}
])Cheers
WaynePS Hope I don’t come over as a bit terse!!
Just like the facts to be presented, so lots of these ok!
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[:0)]Firstly, I am all for property investment, so in picking you up on these points I am not bagging property ok! But obviously I like shares, I make a living from them, so i will address the points one at a time:
1) Shares are more risky because they can go down to almost nothing.
One company may go broke but ever heard of diversification? Imagine if your house was destoyed and the insurance company reneged. Same scenario. You can also insure(via hedging) your portfolio. Shares even have a huge advantage in this regard. If the company is on the slippery slope towards bankrupcy you can short sell that sucker and make a killing while the share price is going down
2) Shares have no ‘use’ if you can’t sell them. Houses have an intrinsic function. Like if global ecomony crashes, a house is still a house worth living in.
Companies provide infrastucture for the houses. Ever heard of Telstra or AGL? If global economy crashes, buy gold shares
3) Shares fluctuate wildly compared to property the spikes are fast and sharp. Property has more gentle lines and has trended upwards for 100 years. Western world’s average growth 7 percent per year, including the depression !
Shares on an unleveraged basis has outperformed property in the same period. Pull up a 100 year chart of the Dow Jones and you’ll see a fairly smooth uptrend also.
4) Shares are boor-r-r-rrrr-innnnggg and you have to keep an eye on the market at all times and maintain an encyclopaedic knowledge of the market at all times.
Shares are anything but boring to those interested in them. I’m sure property is as boring as hell to those not interested.
5) Share trading is stressful and traders have a high burnout not to mention suicide rate
Well I don’t know the figures so can’t argue. But if someone finds it stressful then it is not for them.
6) you can’t ‘set and forget’ like you can with properties. OK if you can (dividend shares) you won’t get the returns.
Huh? Again pull up a long term chart of some dividend stocks, you will see this is not true. Dividend share can have excellent growth, same as houses. Which houses or which shares make the difference. You can’t really set and forget any investment, but part of my portfolio I call my set and forget portfolio. The scrip is in the bottom drawer never to be sold….unless I decide to sell[
]7)The bank loves lending money to you secured against properties to buy more properties. They don’t have the same feelings about lending you money to buy shares.
Rubbish! Ever heard of margin lending? You can borrow on your shares up to a LVR of 75% And guess what? You don’t even need to qualify; no financials or proof of income required… as long as you got shares to lend against.
8)Your ‘shares’ are really just a ‘virtual’ ledger entry somewhere, as is a so-called ‘cash deposit’ in a bank. Computers can be wiped, destroyed, alterered, hacked..a house cannot.
You are part owner in a company. When you buy shares you are supplied hard copy evedence of your purchase and holdings.
9)You can insure houses against things happening – right down to the tenant not paying.
You can insure your portfolio with put options or index futures. And there is no danger of your claim being refused.
10)There are more millionaires from real estate than there are from any other form of investment.
Dolf’s favourite assertion, I personally would like to see proof of that cause if you remove the value of your PPOR. I don’t believe it.
11)You can unlock the equity in your house if it goes up in capital gain without selling it.
Same with shares through margin lending. Exactly the same! Except the process is one hell of a lot easier with shares.
12) capital growth is compounding, so it’s actually a lot faster than the annual figure – and gets faster and faster the longer you hold onto it (in terms of ‘how much your property went up’ in a year)
(sigh) Same with shares if you are leveraged with margin lending.
Also with shares your transaction costs are miniscule compared to property, as little as 0.11% in and out. Liquidity is far superior. I can decide to sell mt NAB shares right now and by 10:10 AM monday morning they will be sold, with the proceeds banked on wednesday.
I suspect most of these erroneous assertions come from somebodies property investing course; like dolf de roos; but as you can see most of it is simply rubbish
I have no problem with people not wanting to invest in the share market. It’s horses for courses. But lets just get the facts straight eh!
Cheers
WaynePeter,
That really is great advice.
Do you mind if I put that on my website, with credits to your good self?
email me [
] [email protected]Cheers
Wayne
The cheapest brokerage is in fact zero, that’s correct zero AND they will lend you 95% of the money but only on ASX 200 stocks.try dealforfree.com.au
True, xyzzy.
But free effective brokerage only realy applies to the biggest stocks. On the smaller more volitile stocks the wider spreads will cost you more than brokerage.
But I don’t think they will take on a novice sharetrader, I may be wrong there.
I wouldn’t recommend D4F for a beginning trader. This is in fact who they make most of their money from because they lose it so quickly with CFD’s.
You have to understand all those fun trading concepts such as risk, reward, position sizing, derivitaves, leverage etc etc etc .
If you’re a seasoned ASX guerilla fighter, go for it. If you can make good money trading FPO’s then you will be fine with CFD’s up to a certain account size(and you can short sell as well[
]) If you occassionally suffer drawdown in your normal account, the leverage in a CFD account will eat your capital alive.Remember the words of Che Guevara:
“The first rule of guerilla warefare is survival”Cheers
Wayne
Valuer General doesn’t have a web site as far as I am aware. Some info can be found through http://www.dola.wa.gov.au and http://www.reiwa.com.auThanks[
]Wayne
The only winners from litigation are likely to be the solicitors.
Gordon
Invest in People for a Prosperous Future!
From bitter experience, I know this to be true. I can tell you stories about lawyers and courtrooms that will make your hair curl.[
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[]Cheers
Wayne
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