Investing in shares for yield and some CG then pulling out ?

I was thinking of investing over $1m in the share market.. A balanced portfolio with balanced risk..

But I want to invest only for 2-3 years to accumulate some dividends and then pull all the money out for a profit and use it for other investments.

I realise that the value of my money is at the mercy of the share market once it's invested. But is it a case that once my money is in that it should stay there for a very long time?

I'm trying to use the share market as a high yield paying 'long term deposit' if you know what I mean..

Good or bad idea?


-Frank

 

What are the "other investments"? Why are they viable in 2-3 years but not now?

 

Fantastic in theory and if it stays stable for 2-3 years it will work. Only hindsight will be able to tell you if it works.
It will cost you a little bit of your "profit', but perhaps some longer term Put options will hedge some of the risk. Do the maths and see if it comes out in front of a term deposit. It will depend on the time frame as well.
There is risk with most investment, do you have a fall back position if the positions in the share market don't go with you for 2-3 years?

 

Frank ,

do you need ( in your opinion ) to fully extract all your cash and profits ??

I am a fan of rescuing my investment cash + costs when in ( roughly ) 150% profit ( selling about 40% and keep 60% of the equities ) such a tactic defies time schedules it may happen within months or several years .

also participating in any DRP plans might suit you , as well

as an example you put $1mill. in the market and say take out $1.1 mill but ( maybe ) leave in $200,000 worth of useful shares , to keep growing/pay divs .

I would suggest being flexible in your plans ... I have found 'IF ' not ' when ' a good idea .

good luck

 

Particularly like this piece TS. Over the journey it has been drummed into me (by the market) to never get ahead of yourself and have grandiose plans to "Sell out when BHP get to $35". Always good to have a plan but change the word when for if

 

Hosko ,

my plans ( without flexibility ) may not have been as successful ,

with 'set price targets ( buy or sell ) that is always moderated by current news and conditions ,

for example I have avoided the recent oil and iron rally , ( having taken some profits ) looking for a second dip in the middle of this year ,

many traders will have done well , but I prefer a longer term aim .

personal needs should always be remembered .

 

TS, I'm sitting on the hands at the minute looking for a move either way (play the ASX options). See what next week brings.
But I only play with beer money not life savings so different story to Frank. Our money is currently tied up with real estate and I'm not looking to borrow more at the moment.

 

I am playing with the ' life savings ' ( actually a multiple inheritances ) , there is little chance of financial recovery ' for me if I get it badly wrong ..... .

but again if I 'cashed out ' like Frank plans , I lose my healthcare card with means $1000 a month disappears for meds ( plus other medical costs ) ,

I have some direct property exposure but nothing grandiose , just practical , with some future potential either as a future residence , or extra income .

to add extra spice to the mix , a phone-call on Friday added extra uncertainty to the mix ( put an extra question mark in the time-frame column ) ,

I definitely prefer low debt , but need the capital invested WORKING ( not parked )

 

'Other investments' are property. Viable in 2-3 years and not now is because I don't have enough money now.. Hence why I want to invest in shares to make some money and then pull it all out to invest in property.

I just want to use shares as a money making tool for a while. 2-3 maybe 4 years.

-Frank

 

I have tried investing with time-frames targets in mind , but have kept having target dates proving to be elusive .

good luck on your aims , but keep your options open