I see the Australian All Ordinaries Equities Index consolidating over the next week. I dare say there will be some volatility, but the market index will likely go sideways. The broader market will likely be weaker, but the resources sector should hold up reasonably well.
I actually see the current market as a good time to buy 'spec' resources, while I would be trading out of blue chips to re-enter the market in a few weeks. I made the point about 8 months ago that this was a traders market. Alot of volatility. This is NOT a market for the 'buy & hold' strategy.
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Andrew Sheldon
www.sheldonthinks.com
Investment Strategy
If you are investing for the long term, you still need an investment strategy. Dont be fooled by the rhetoric of fund managers. The reason they advise you to 'buy & hold' is because they dont want to compete with you in sell-offs. Markets and industrial sectors are cyclical, so they demand trading to get the best returns. Fund managers actually cant hope to match the performance of small investors (if you are half good) because they have to manage huge amounts of funds and charge you a fee besides.
MY ADVICE is (i) look at a range of market indices and decide upon what level of correction would give you the justification you need to get in & out of the market. It might be a 5-10% retracement or a break of trend. (ii) Diversify if you dont have an intimate knowledge of the company or management. More than 30% in one company is aggressive.
I see the Australian All Ordinaries Equities Index consolidating over the next week. I dare say there will be some volatility, but the market index will likely go sideways. The broader market will likely be weaker, but the resources sector should hold up reasonably well.
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