Spread your smart while you wait
Answers
Answer:
In terms of when to buy shares, you should do so when the price matches the valuation you have placed on them. This valuation will be discussed in more detail in future, and of course there are many different ways to value a company, but essentially you should focus on net assets and past profitability to decide how much goodwill you are willing to pay per share.
Once the share price matches your valuation you should take your time and wait for the next annual report to be released to check that profits are as you expect and that there are no fundamental changes to the company. Similarly once the valuation placed on the company by the stock market exceeds yours by a pre-determined distance, say 50%, then sell.
Answer:
In my previous article I introduced the concept of apportioning capital between shares, bonds and cash. This second part will cover some simple rules which can help smart investors to apportion their capital in a sound and logical manner.
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✦ example :
In terms of when to buy shares, you should do so when the price matches the valuation you have placed on them. This valuation will be discussed in more detail in future, and of course there are many different ways to value a company, but essentially you should focus on net assets and past profitability to decide how much goodwill you are willing to pay per share