Though it would be worth sharing what I think are a couple of short term targets for trading contracts for difference. Now there are many who will say that these are obvious targets, but that is exactly the point. Make sure you do your own research before trading but these are two stock that have served me well recently.
With the currently political instability, problems in the US and China slowing the Australian mining sector continues to take a hit. It is for that reason that BHP and Fortescue are interesting prospects to go short on.
BHP
Have a read of the article below which ran on the Forbes website yesterday 27/06/2013 leading off with 'Base materials have been a heavy load to bear over the past two years since the China recovery has never really taken hold. This is seen in the shares of natural resources companies, such as BHP Billiton'.
Now the Forbes article is referring to the US share price, but it is reflective on the ASX at the moment. Keep your eye on the trend here and monitor demand but definitely a stock to go short.
http://www.forbes.com/sites/zacks/2013/06/26/shares-of-bhp-billiton-hit-four-year-low/
Fortescue FMG
FMG has been in a downward trend since February now and is not showing signs of breaking out of this. Last week the Western Australian reported that 'shares in Fortescue Metals Group have tumbled after the iron ore miner
cut its production guidance by two million tonnes for the financial
year, citing the impact of "unseasonable wet weather" on its operations'.
Further to this FMG have themselves said that 'Fortescue is now in a phase of significant cost reduction and continues to focus on operational efficiencies which will see it moving down the global cost curve'.
All in all this looks very much like it has further to fall but monitor demand and set tight stops if you choose to trade.
http://au.news.yahoo.com/thewest/business/a/-/national/17679476/fmg-slumps-on-output-slide/
Like I said do your research and remember to make sure you trade with in your means, sticking to a plan.
Wednesday 26 June 2013
Monday 24 June 2013
Make Money With Take Over Targets
Now what I am about to talk about is not easy, per what the article says you almost need insider information (which is illegal and you should never seek - you will be in a lot of trouble is caught) to get ahead.
However, having said that if you are very smart and keep your finger on the pulse you can make a very good return from buying potential takeover stocks. Go back and look at BHP and RIO before the GFC when these two companies were in the process of a takeover, the stocks went nuts!
Here is the start of an article from the financial review smart investor with a link to the whole article that sums it up perfectly;
"Share investing is usually a get-rich-slow proposition. Equity holders are rewarded over the long term through dividend payments and capital gains for investing their money in listed companies.
But certain events – such as a takeover bid – can make a company’s stock price skyrocket, delivering an immediate potential windfall to shareholders. To reap the best returns, however, you need to hold the stock before it becomes a takeover target and without insider information, it can be tricky – but not impossible – to pick the companies that will be targeted.
The pay-off for owning a takeover target can be significant. A credible bid usually drives a company’s share price higher as soon as an offer is made, even though the actual sale may take months or years to come to fruition – or may not go ahead at all.
Australand Property Group’s shares jumped 6.3 per cent in December when the company received an unsolicited takeover offer for part of its business from GPT Group. Similarly, financial advice and accounting company WHK Group’s shares rose 8.7 per cent in October when it was approached by another financial planning business, SFG Australia, for a possible merger."
Read the full article here - http://www.afrsmartinvestor.com/p/magazine/get_rich_quick_buying_takeover_targets_HMW4WYqh2MwcsSRwesqdvL
So where to you go from here? my advice to get ahead of the rest is to set up some Google alerts, these will directly email you for certain search terms such stock market news or company takeover. Once you have the info on a possible target you can monitor volume and decide if you want to trade.
Oh and if you need info on how to set up a Google alert you can find it here
However, having said that if you are very smart and keep your finger on the pulse you can make a very good return from buying potential takeover stocks. Go back and look at BHP and RIO before the GFC when these two companies were in the process of a takeover, the stocks went nuts!
Here is the start of an article from the financial review smart investor with a link to the whole article that sums it up perfectly;
"Share investing is usually a get-rich-slow proposition. Equity holders are rewarded over the long term through dividend payments and capital gains for investing their money in listed companies.
But certain events – such as a takeover bid – can make a company’s stock price skyrocket, delivering an immediate potential windfall to shareholders. To reap the best returns, however, you need to hold the stock before it becomes a takeover target and without insider information, it can be tricky – but not impossible – to pick the companies that will be targeted.
The pay-off for owning a takeover target can be significant. A credible bid usually drives a company’s share price higher as soon as an offer is made, even though the actual sale may take months or years to come to fruition – or may not go ahead at all.
Australand Property Group’s shares jumped 6.3 per cent in December when the company received an unsolicited takeover offer for part of its business from GPT Group. Similarly, financial advice and accounting company WHK Group’s shares rose 8.7 per cent in October when it was approached by another financial planning business, SFG Australia, for a possible merger."
Read the full article here - http://www.afrsmartinvestor.com/p/magazine/get_rich_quick_buying_takeover_targets_HMW4WYqh2MwcsSRwesqdvL
So where to you go from here? my advice to get ahead of the rest is to set up some Google alerts, these will directly email you for certain search terms such stock market news or company takeover. Once you have the info on a possible target you can monitor volume and decide if you want to trade.
Oh and if you need info on how to set up a Google alert you can find it here
Tuesday 18 June 2013
2013 Gains Wiped Away
The last few weeks have been tough ones on the Australian share market with all but wiped away any gains for 2013. This has been sparked by fears that central banks in the US will pull the pin on cheap money.
At one point last week the ASX 200 hit an intraday low of 4658 points - only slightly above where it was at the start of the year, at 4644. The All Ords hit its lowest point of the year at 4650 points.
The market has now fallen 10.1 per cent since its highest close for the year in mid-May, entering into what is widely considered a correction. Tonight is also big for the market with the US federal announcement bound to have knock on effects for our market......we wait and hope it is good news.
The good news is for home owners with the Reserve Bank of Australia has indicated it is prepared to cut the cash rate further even though the Australian dollar is falling. In its June board meeting minutes, the central bank says the high Australian dollar has been a drag on much of the non-mining sectors of the Australian economy.
The RBA has said ‘‘The exchange rate remained at a high level considering the decline in export prices over the past year and a half. It was possible that the exchange rate would depreciate further over time, as the terms of trade declined, which would help foster a rebalancing of growth in the economy.’’
It is going to be an interesting 24 hours - happy trading
At one point last week the ASX 200 hit an intraday low of 4658 points - only slightly above where it was at the start of the year, at 4644. The All Ords hit its lowest point of the year at 4650 points.
The market has now fallen 10.1 per cent since its highest close for the year in mid-May, entering into what is widely considered a correction. Tonight is also big for the market with the US federal announcement bound to have knock on effects for our market......we wait and hope it is good news.
The good news is for home owners with the Reserve Bank of Australia has indicated it is prepared to cut the cash rate further even though the Australian dollar is falling. In its June board meeting minutes, the central bank says the high Australian dollar has been a drag on much of the non-mining sectors of the Australian economy.
The RBA has said ‘‘The exchange rate remained at a high level considering the decline in export prices over the past year and a half. It was possible that the exchange rate would depreciate further over time, as the terms of trade declined, which would help foster a rebalancing of growth in the economy.’’
It is going to be an interesting 24 hours - happy trading
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