Thinking of getting a credit card to buy some shares..

[geordie1]

i did once borrow 22 years ago r70000 overdraft with town house as surety to invest in overseas property stock (fit as I recall then liberty international then capital and intu)anyway knew i was at risk sweated for 8 months fit rose from around 8.15 to1315.sold enough to pay off loan and kept balance of shares with i still have today.never again but it worked and was young enough to take the risk.sure it is against best advice but if u want to be free sometines its worth a gamble

[Enzed]

Satrix or other ETF is the way to go. Couple of hundred R per month.Then cash in when you have built it up. Check it out. www.etfsa.co.za

[barry_1]

As i recall Mr S has been around for a long time.I presume you are just thinking up new ways to invest?At one time Standard used to loan one the money to do so.Now the most sophisticated way is with Standard Installments.There is a monthly charge,which could be considered fairly steep,but since one has only to put down part of the price might suit your ambitions.I have found this method good with well chosen selected shares.

[hexadecimal]

Please don't do it. put the money in the savings account till you get a 'lump' sum and can afford a cheaper 'larger purchase'. When you have a winner it's all good. When it goes wrong, building yourself up to the same place takes 10 times longer to replace the loss. Patience discipline timing.

[Mr_S]

Actually i was thinking along the lines of Shoprite and or PSG...id need the money primarily to invest in either one of these companies...

[Mr_S]

exactly...so its possible! however people are assuming I want to trade the shares...im buying with a view to holding for at least 10 - 15 years

[Mr_S]

Thanks barry...I havent actually considered installments...ill look into it, I know you have been big on them for a while...my issue though is do I get to keep the shares afterwards or do I need to sell once the installment expires? Because ultimately Id like to keep the shares

[Mr_S]

Thanks guys for the responses. I see that generally everyone is against the credit card issue...which makes sense. However I am pretty young, (24) and I feel like I am not really taking the huge leaps I should be taking at this age (taking into account that I should have time to recover)...it has taken me such a long time to reach my current portfolio size and I feel I am really missing out on huge gains purely because I cannot enter the share with enough to make a dent...I am not trying to trade, purely to get enough money to invest with a 10 - 15 year time frame..(sigh) guess ill have to think a little harder..

[Juve]

First golden rule..... Only invest in the market, monies that are spare or not needed. Taking it from a credit card does not comply with the "golden rule". You could find yourself in the very ugly situation of the position you take moving against you and having your credit card maxed out. This is a perfect recepy for financial disaster. No my friend rather not.

[Juve]

Just because you are 24 it does not mean you have to take wild and unreasonable risks. Risk should always be a calculated one, and one in your means. Even if not my favorite investment you could look at quality share warrants. By the way I like your Shoprite idea, have been looking at it for a while and think it could rally soon.

[barry_1]

Hi,no you have several options....The original idea was after buying part of the installments was that when the price had risen enough you would sell some of them then pay the rest of the money to replace it with a full share.As the installments have all the ordinary rights of full shares,you receive the full dividend as if you held the full share at the time when the dividend is payed...They vary in price and might cost about one third less or more of the full share.Of course you need never buy the rest of the share and usually at their expiary you can roll them over into a new installment.Do remember to ring the issuer to find out all the details as each one has slightly different rules.I prefer Standard Bank istallments as you can determine the right price by using their matrix.

[barry_1]

PS Look under tools ,,,there is an instalment course on the site.Good idea to read through it.

[#13]

i took a R80k loan last year Jan to buy PNC,CML and CCO. i will finish paying my loan in December. i have outperform the loan more than 3X

[#14]

I do not see a good reason to try to preserve R20k at all...i mean what is 30% of R20k even if you made the 30%,i know lot of people who can blow 6000 in 5 days..you would need to be alive for the next i dont know how many years,outperform the market every single year for a longer period..,which only few guys have managed to do to begin to see a decent amount in your acccount.i say take the loan,use cfds.You most probably going to lose most of the money if not all of it,if you are a beginner...but the lesson learnt there will be worth more than buying clothes on a credit card.use the lesson to make money in future years...or you can do everything the conventional way...I am no financial adviser by the way,its all just a thought

[#15]

The holy grail on investing, never invest more than 2% per share of your trading account.Rather diversify.

[#16]

The holy grail on investing, never invest more than 2% per share of your trading account.Rather diversify.

[Mr_S]

was it a personal loan or credit card, because maybe I should be looking towards a personal loan instead...less interest etc etc

[Vince888]

Overdraft is also another option. Standardbank offers 8.5% interest on overdraft facility. much less than traditional credit card and personal loan.(Subject to your affordability and risk profile). My suggestion take overdraft instead. Buy Quality stocks over quantity with the overdraft and your return should outperform the interest rate.

[Vince888]

IE. bought CML 20th December 2012. My gains to date over 60%. 7 x more, so far than the annual overdraft rate of 8.5%