Advice please - on a stock that I hold in my SMSF that I have lost a bucket lod on!!

Gordon Gekko

Gordon Gekko

Hi All,

Over the last 12 months, I have been busy with family matters and I have taken my eye of the SMSF (that is one of it's down falls)

Anyway, I (or it, SMSF) has taken a big hit on one of the stocks, 50% down $15,000 (approx)

What to do?

a) Just leave it there, it will go back up one day :eek:
b) Average down (i.e buy more) (Throw good money after bad:rolleyes: )
c) SELL!!! Take up the loss against gains and get on with life

GG
 
I'd be holding that one long term.....it's blue chip, millionairs factory stuff....

Only my opinion tho....

You have not lost any dough yet.....not till you sell.

have you not received any divs....?
 
Thorpey,

You have not lost any dough yet.....not till you sell.
Click to expand...

Umm,

My take is that he has lost only $15,000 at this point in time. If he keeps it, it may go back up in price or it may go down in price. If it goes to 0 he will have lost $30,000.

GG

As the current price is around $36, to be 50% down means you bought it ~$72. It has not been that price since the beginning of '08. 12 months ago the price ~$48.

My 'advice' about what to do in the market goes along the lines of if you don't know what you are doing, stay the hell away. Get yourself educated before you participate. You are unlikely to be thinking clearly about what to do while caught up in the losing position.
Is it currently the best thing you could be doing with the $15,000 you still have invested??

bye
 
Hi Bill,

Thanks for your advice.

I have have "systems" in place which have served me well over the years. But as I mentioned, i took my eye off the ball and look what happens.

I ask for advice because i have never found myself in this situlation before, I would have sold a long time ago.

Cheers

GG

PS I would never take option B, i just put it there because someone would say, hey you left out another option :D
 
Hi GG,

Looking at the stock, there would have been reason/reasons why you bought it where you did. If you did not own the stock at all, would it meet your buy criteria now. If it is not a buy according to your criteria at the current price/fundamentals, then you have your answer of what you should do.

If it is a buy at current price, then your plan would be to have a stoploss at X level, again you have your answer of what to do.

Basically it is follow your plan if it has a long term positive result, despite there being a 12 month hiatus in your attention and a loss. The same goes for every other stock in your portfolio, check them as well, and then proceed as normal. If this is the main part of your SMSF, ie over 10% of fund value, then you probably need to rethink what you are doing with it.

bye
 
Thorpey said:
You have not lost any dough yet.....not till you sell.
.?
Click to expand...

If an asset has halved in value, then you HAVE lost dough, you just haven't realised the loss. It may be a paper loss, but it is still a loss.

Assess the stock on its present value. If you can see better value or more potential elsewhere, then sell and invest in an asset you think has better prospects. If you believe the stock has good potential, then hold. If you are absolutely certain the stock will only increase, then invest more.
Marg
 
marg4000 said:
If an asset has halved in value, then you HAVE lost dough, you just haven't realised the loss. It may be a paper loss, but it is still a loss.Marg
Click to expand...

Marge, what if it goes back upo tomorrow, have you still lost money today ?


Paper losses can be tempoprary too remember, even in things other than property... my portfolio goes up/down every single day, don't know about yours.... if I were to consdier each fo these movemement an automatic loss I think Id have have had multiple heart attacks by now....
 
Gordon Gekko said:
I ask for advice because i have never found myself in this situlation before, I would have sold a long time ago. :D
Click to expand...
big.chart

This is just a simple chart to give you a idea on how it has tracked others
and by the looks you may have bought into at the peak,there is only 2 ways to look at this,and you don't read this in books or hear it from share trading guru's,1.. people always sell the equities that go up in value while keeping the one that underperfrom,and live in hope that the units they have lost money on go up in value,:rolleyes:,don't fall into that trap,15k is 15k,and with the way several OS countries are starting to feel the pain again,plus China will slow itself down with higher interest rates,and a very small ripple in China would have a tidal wave in the miners in this Country..imho..willair..
 
marg4000 said:
If an asset has halved in value, then you HAVE lost dough, you just haven't realised the loss. It may be a paper loss, but it is still a loss.

Assess the stock on its present value. If you can see better value or more potential elsewhere, then sell and invest in an asset you think has better prospects. If you believe the stock has good potential, then hold. If you are absolutely certain the stock will only increase, then invest more.
Marg
Click to expand...

First part of your reply is contradictory. Makes no sense. Like saying "..it is...but it isn't.."

Second part is obvious...but for me the stock in question MQG is as good as any other that you have indicated may have "better prospects"...

I'm merely suggesting to keep the $15k invested in a blue chip not pull out of one and go into another....heck.. that's just the same as averaging down isn't it....!
Unless you are a stock guru that is....:rolleyes:
 
Only sell if you need the capital loss or if it makes up a significant % of your portfolio and you need a better return on your $$$.

Personally I have been picking up their shares and I have no problems holding them in a balanced portfolio.
 
vbplease said:
I agree with Marge, a loss is a loss.

This sounds like someone living in hope..
Click to expand...

My post posed a question, not advice to be acted upon alone, I don't think I gave the original poster a suggestion or voiced my opinon on macuarie shares at all...

Many people accumulate in hope that shares will go up, I was not being simplistic and suggesting "every share will go up so hold it till ti goes up again"

Just saying that shares do move, and asking, if you really think they will , and they do, have you really lost ?..

Then again, a signifcant chunk of a portfolio, not earning you money may be a concern that outweighs getting your money back / a bit of growth later on..

So again, in the advice regard I don't know. But usually, one takes more than 1 aspect into account when making these decisions right, so a loss still being a loss may be correct, but may not necessarily dictate on it's own that the best course of action is to sell immediately, I think.
 
So one has decision to make based on what they believe would bring the best outcome right ? Which could be sell or could be something else right ?
 
Considering your SMSF is a long term strategy and MQG fell in price with the GFC. I'd keep it. I think its safe.

But i'd do a wash on it. Which is sell it and buy it back straight away at the same price. Gives you a realised capital loss and you still hold the shares.

What's the dive on it?

This is not advice. Just what i'd do.
 
jaycee said:
Marge, what if it goes back upo tomorrow, have you still lost money today ? yes you have - and if a tree falls in the woods and no one hears it it has still fallen


Paper losses can be tempoprary too remember, even in things other than property... my portfolio goes up/down every single day, don't know about yours.... if I were to consdier each fo these movemement an automatic loss I think Id have have had multiple heart attacks by now....
Click to expand...

Agree with the second half of what you say - the difference in this case though is this isn't daily price fluctuation this is a sustained loss over a period of time - not saying it won't go back up (I think it will but it will take years).

Also agree with evand - it's been held for over a year sell and pillage as much tax concession as you can and re-buy (or invest in something else if you have your eye on something)......please note I don't know your tax situation and am assuming you can use the tax break - if this isn't the case please disregard my last comment
 
Hi Formerlurker, yeah can see that now too and I think that Marg was considering that alsoin her replies.

I like evan's approach though if one were to decide they were worth keeping at this price !
 
You must log in or register to reply here.

Similar threads

T
Share Trading
2 3 4
Replies
78
Views
12K
charlieandkath
C
P
Is my loan now contaminated? (have I lost deductibility?)
Replies
5
Views
2K
Propagate
P
J
Great apartment, crap location (Melbourne CBD) - advice needed
Replies
19
Views
3K
jerrybee
J
T
Please kick my tyres.....
2 3
Replies
45
Views
8K
HiEquity
H
M
Advice on a family matter please!
2 3
Replies
43
Views
6K
Mitch1
M
Back
Top