Today's market

[BoburUncle]

Let the great roller coaster ride begin......

[sponono]

have never seen the market this volatile before. amazing thing is that the Rand is still weak and gold is still quite high.

[#3]

you haven't been trading very long then - in 2008 the average daily trading range of the ALSI was 1000pts. In May 2010, we were averaging 600pts per day. Right now, the average has just spiked to 500pts in a day.

[BoburUncle]

It's new for me. Only been trading for a year which has been bad so far, and now this. Holding on to my seat here!

[#5]

this is a day trader's market. You either enter long term, or you trade intraday. I would seriously caution against taking out CFD positions in this. Imagine if you were on the wrong side of BHP today? You need to have big big stoplosses on a CFD for this - and a big stoploss means poor risk / reward.

[BoburUncle]

So I am discovering everyday....

[BoburUncle]

I have tried CFD's, but like you said it's intraday trading, and I dont have the time during my day job to do that. I will have to start long term inversting, but with my current low capital amount, it will have to be in a penny share of some sort

[SimonPB]

doesn't have to be a penny shae .. it not about the quantity, it's about the quality ..

[#9]

Yip, if you don't have a lot of capital then your only strategy available to you is value investing. Every other strategy requires you to spread your risk, but value investing lets you hone in on a low risk quality stock. And you will not, I assure you, find a penny stock that fits this category. At these prices, there are a lot of top40 stocks out there offering value.

[BoburUncle]

Great, thanks for the advise.

[BoburUncle]

Where can I find a list of the Top40 stocks?

[#12]

http://www.satrix.co.za/documents/document_767.pdf

[#13]

Eish boet - you are asking the wrong question. The right question would have been, where can I get information on value investing principles?

[BoburUncle]

Ah ok, where can I get information on value investing principles? :)

[#15]

google, investopedia, OST training courses are a good start

[BoburUncle]

So, if I use the Magic Formula correctly, I should be able to pick out a good value share to invest in?

[#17]

No. That is a different strategy again. MF is a lazy trading system - it does not bother about fundamentals, but it is not bad at picking out value either. True value investing has to look at fundamentals. Since you are only picking a small selection of stock, you have to get it right. There is tons of buffet investment style information on the net. Try to filter through some of it to get the idea.

[#18]

I don't want to get into a debate on the merits of one strategy vs another, I just wanted to point out that you, by the looks of it, don't actually have a strategy, which is probably the biggest mistake you can make.

[BoburUncle]

Ja you are right. I havent been able to figure out a stategy yet, which is probably why I havent been sucessfull yet. Thanks for the advise, I will pull finger and sit to work one out now.

[#20]

I will try to make it a bit easier for you to select one though. If you have limited funds, then you can't use any strategy that requires you to spread your risk - except invest in an EFT. You also can't cost average (unless you have more money coming in). So you have to pick a stock(s) and pick right. You might still be looking at further downside, but nothing you can do about that. Your strategy has to rely on the long term sustainability of the stock you pick. That is why you want something that is relatively cheap, and, to quote buffet, still has a couple of puffs left in the cigarett butt