Funds & shares - Anyone heading for the exits yet

[BV]

I just have to ask why are people worried about the Banks,willair..

I don't think anyone here is worried about our banks. They're well capitalised and have good income.

My reference to the price of CBA and other Oz stocks was in relation to external factors from overseas. I think you'll agree that a share price can fall irrespective of how well a company is doing in its core market

 

[Ridin-High]

CBA are just so good at what they do, i bank with them... and have only had small experiences with other people @ other banks. But When you walk into a CBA, they treat you like a king/queen.

Hi Sir, How can we assist you today?
No Worries, take a seat ill grab someone that will be able to assist, would you like a glass of water. Also feel free to have a copy of money magazine to read, you can take it home if you like

Customer service of the gods.

They also know how to squeeze a buck and cross sell different products very well.

As the market leader i think its ok they have a slight P.E over the others, i think the hard work in the customer service will not only retain clients but future generations of clients because of the work they done now. Parents will be like, yeah bank with CBA and so forth.

With BHP/RIO the dividend yield is small because they only pay out small % of profit, opting to re-invest earnings to grow the companys assets for larger/more stable dividends in the future.

This sort of conservatism has helped them come threw the GFC with a strong balance sheet able to take advantage opportunities now available. *note rio nearly owned themselfs i think from reading with the alcan take over*

 

[Intrinsic_Value]

But then again is it a stock market or a market of stocks.
Same argument that can apply to the property market, just because the whole market achieves x % return doesnt mean each individual property will replacate that exact same return.

My yoy return (ie Aug 09-aug10) on the stock market is 16.3% after all transaction costs (but not including tax yet, havent done the tax return yet).

My calender year(ie from 1st jan 2010) return on the stock market is 8.7% after all transaction costs.

Forgot about some profits that i have transferred out of the account already.
The above figures should read approximately 26.3% and 18.7%

 

[steveadl]

CBA are just so good at what they do, i bank with them... and have only had small experiences with other people @ other banks. But When you walk into a CBA, they treat you like a king/queen.

Hi Sir, How can we assist you today?
No Worries, take a seat ill grab someone that will be able to assist, would you like a glass of water. Also feel free to have a copy of money magazine to read, you can take it home if you like

Customer service of the gods.

They also know how to squeeze a buck and cross sell different products very well.

As the market leader i think its ok they have a slight P.E over the others, i think the hard work in the customer service will not only retain clients but future generations of clients because of the work they done now. Parents will be like, yeah bank with CBA and so forth.

With BHP/RIO the dividend yield is small because they only pay out small % of profit, opting to re-invest earnings to grow the companys assets for larger/more stable dividends in the future.

This sort of conservatism has helped them come threw the GFC with a strong balance sheet able to take advantage opportunities now available. *note rio nearly owned themselfs i think from reading with the alcan take over*

Some good comments above RH. I agree with what you say business wise, however I'm still greedy and want higher yields. So perhaps once the banks get whacked again from an external factor like BV mentions, or sentiment turns against BHP due to metal price fears, acquisitions etc - then I'll jump into them (though I am realistic and know I'll never get a big yield on BHP - a figure beginning with 5 would be nice). May not happen, but there's no rush, plus the goal posts always change so who knows what 6 months time will bring.

 

[Intrinsic_Value]

(though I am realistic and know I'll never get a big yield on BHP - a figure beginning with 5 would be nice)..

i would be careful buying a cyclical company based on dividend yld.
This is where potential classic value traps are formed, investors are looking at the rear view mirror and notice a fat 5% yld on a cyclical company and thinks it represents a 'good buying opportunity'. They dont realise that the market is looking forward and knows that future earnings will be declining, hence that 5% yld is unsustainable.

I made this mistake with several companies during the GFC, i started buying the shares too early and then compounding the problem by dollar averaging downwards, but always with my eyes on their historical earnings. I made this mistake with Perpetual, Lend Lease and Macquarie off the top of my head. Little did i realise that their pre GFC earnings where not sustainable under more subdued economic conditions.

I have subsequently tightened my purchasing and dollar averaging criteria

 

[steveadl]

You raise a good point IV. BHP I look at more for growth, but I would just like it to cost me less to hold in the mean time (not using my money ), granted we're not talking a lot either way, but I'd like to see it have one of it's scare dips again before I buy in.

 

[Corey Batt]

Zooooooooom, zip, kapow!

I find myself in an interesting situation in this market. Around 18% return in the last 3 months and looking to go along for the continuing ride. Other investors I know are pulling out to get into gold and say I should be following this route. However due to my position in the market not being a huge part of my funds, I can continue with these gains or in the case of double dip market meltdown wait until the bottom stirs and margin lend myself to the teeth at the next buying opportunity. Its all relative.

 

[Sunfish]

in the case of double dip market meltdown wait until the bottom stirs and margin lend myself to the teeth at the next buying opportunity. Its all relative.

No one rings a bell. How DO you recognise THE bottom?

Find a chart of the DOW in '29 / '30 and see how often you could have bought back in only to be slapped down again. '87 was an anomaly when it bounced the way it did.

 

[Corey Batt]

I completely agree Sunfish. My 'bottom' for me is trying to aim for 'not the top'. Bit hard to explain and don't expect many to understand. I'm quite fine taking a negative hit over the short term as it fits with my investment plan.

I am very aware however in that I can still be burn't.