Millionaire thru shares

bort said:

Hmmm thought i might put in my 2c - I have been investing primarily in shares for about 7 years or so (apart from my ppor which i am also currently selling) - but I just dont have too many of those quick gain stories.

I am a buy and hold investor - these days a substantial portion of my portfolio is in good old AFI and ARG, which I buy when it is trading at a decent discount to its' net assets (as well as taking up their $5,000 share purchase plans each year if appropriately priced). I think that has netted me about a 25% annual return over the 7 years - although I guess a lot of that could be from the booming share market than anything else, and the ability to further leverage and buy more via margin loan as prices have gone up.

Can't say i'm at the $1m yet .. maybe only halfway in terms of $ ... much closer in terms of timeframe to go with any luck. I started really small in terms of $ invested so the first few years were really slow going, however that snowball is getting bigger faster now! Will i get there primarily through stocks? - absolutely no doubt (although will i diversify into property as well? - umm given i'm on these forums lurkin around not much doubt there either)

Oh i guess there would be a few reasonable performers in there as well come to think of it .. pickin up csl for $12 when it was out of favour, and mbl a few years back too which has been handy .. but overall slow and steady is how my portfolio looks .. with virtually none of the wild swings people talk about - i think the most mine ever moves is maybe 2% in a day!

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Sultan of Swing said:

Yep, good call Marty. But you know what I mean. A $3,500 'investment' (if you can call a spec share an investment) goes to $38,100 and back again to $6,600 still hurts.


Hmmm, typing this has made me realise something. My best shares have all been good companies that have temporarily fallen from grace and rebounded. Uncle Warren would be proud of me.

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see_change said:

You'll need to join to see these .


http://lightning.he.net/cgi-bin/suid/~reefcap/ultimatebb.cgi?ubb=get_topic;f=74;t=000029;p=3

Another reefcap member , Stevo , is using another long term system , and last time I talked to him , he was averaging about 40 % a year.


See Change

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Macca said:

Hi Vla,

You don't have to pay $55 per month for the system, that fee is if you wish to subscribe to Nicks service.

If you have share software the Tech Trader system is available free to anyone who wants it, kind of makes the people who pay spruikers thousands a bit p****d off when they discover what they have paid for doesn't work and a free system does

Stevo uses a variation which I don't think he has disclosed but TT is proven on a public forum, over 3 years.

The stock market has been kind of late but it is all in the timing isn't it, there are plenty of times that real estate is in the doldrums as well, so each has a turn just got to pick the right one

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see_change said:

Stevo has never documented his system in the way that Tech has, but if you read his posts his ideas are all there . He's never given the specifics of his system simply because some of the shares he trades are lower volume than those triggered by Tech trader so he doesn't want people getting the same buy and sell signals as he does though a few times I seem to be in the same trades ...

Basically it's a weekly system , relying on a short term trend breakout , in shares that have a long term momentum indicator reaching a new high . The trailing stop is an ATR based trailing stop that ratchets up . There is code for it somewhere on the amibroker site ( It's the trailing stop that Van K tharp suggest , I think) . Within those paramaters the combinations are endless .... .

Within those combinations it is easy to come up with systems that back test over 50 % though in my experience you're better to aim for lower than that as the higher returning system tend to try and pick up the High % gainers and they also tend to be the more volotile . I also tend to think you can do better when the market isn't going through the roof. These types of systems will pick up on the good performers , whereas in a volotile market , everything seems to be at the whim of the overall market and you can get shaken out of a good trade by the volotility , whereas a steady market seems to be more forgiving.

See Change

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vla said:

Does anyone have an inspiring story about how they became a millionaire thru shares?

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alexlee said:

Actually I think Buffett is an investor in the purest sense. He doesn't really OPERATE most of his businesses (except the insurance business), and he certainly doesn't trade shares. He is famous for letting the previous owners of 'his' businesses operate independently.

I believe that you can contribute, say, 25% of your income into your super fund for 40 years and become a millionaire purely through shares. Boring, but over time it's likely to work.

I also think you can do it faster by leveraging and using property in addition to shares.
Alex

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The other thing to note is compounding and time, and not to undersetimate it. Assume you borrow $100 at 8% and invest it in something paying 7% dividend. But assume the company paying the dividend is growing it's profits by 10%pa.

In the first year, you would get $7 div, and pay 8% interest, you would be down $1 in cash terms, but would have growth in your share price of $10. for a net $9 return.

In the second year, assuming you paid your interest last year, your dividend would be 7%x110%= $7.70, Interest still -$8 share growth 10% x $110 = $11..Net cash out $0.30, net return $10.70 .

In the 3rd year you are cash positive $0.47, net return $11.47

In the 5th year cash in $2.24, total return $15.55
10th year cash in $8.50, total return $29.94
15th year cash in $18.58, total return $53.10
20th year cash in $34.81, total return $90.40.

All this for zero outlay.

Now assume instead of $100 you borrowed $100K.

After 5 years it's generating $15,550 a year for you..

I realise this assumes 100% lending, but add this to the $50K of your own money you invested and bang, you're doing very well. If your lucky or smart enough to buy shares cheaply the return is even higher. This kind of growth is available. I realise this excludes inflation, but you will find these numbers kick other investements in the butt. You will do even better to buy more as you go along as your returns allow you. Of course you know the risks involved, have to understand and manage them.

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sue78 said:

I agree with you. He started off with little money investing his shares. It's the starting off that is more intresting to me than how he makes his money now. His 1st million wa smade purley through investing in shares.

You are also correct about the super. The system in Singapore works well eventhough the cost of labour is high. I think super contribution is like 17%? and then the employer has to match it. Can you confirm this?

That's why majority of Singaporeans retire a millionaire and most with their property paid off will retire multi millionaire.

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Bill.L said:

1/ She had no regard for risk and effectively bet her entire bankrole on a pennydreadful. Is this the preferred method to stockmarket riches??

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RichardC said:

I won't make my mill till next yr. In spite of being a wory-wort, I am confident this will happen.

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