The updated 11 sector selections from the February meeting were distributed.
The short term and long-term selections were reviewed along with several members adding their selected stocks to our listings. The Energy sector in February was only 1 the 2 sectors that had minor gains, overall, the XAO fell 3.3% in February.
An example how to obtain double dividends was presented. This involves buying one stock before the ex-dividend date then selling that stock post ex dividend then from the proceeds buy a second stock before its ex-dividend date. If both stocks are 100% franked this also increases the returns.
John presented the subject of Short Selling which is one of the most difficult concepts for novice investors to grasp. The goal is to profit from a falling market.
This is done by “borrowing” shares in a company through a stockbroker to sell at the current market price, then buying those shares back later when the shares have fallen. The difference in price is the profit.
You then return the shares to the original shareholder. With a minimum investment of $50,000.00 its big business and has a huge effect on the market. Stock pickers need to be aware of the Open ASX Short Position list, as this displays the companies targeted. BEAR EFT is a fund that covers this topic.
The next meeting of Investment will be on Monday 3rd April at 2.00pm in our U3A room.
John Hanlon and Malcolm Sanders