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Beginner needing assistance

Discussion in 'Introductions' started by jms, 3rd Jan, 2008.

  1. jms

    jms Member

    Joined:
    3rd Jan, 2008
    Posts:
    24
    Location:
    Seven Hills NSW
    Hi,

    A beginner needing assistance. I am looking at starting share trading, and perhaps options trading.

    But before doing so, what forum do I post questions about trust structures ?

    Regards,

    jms
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,623
    Location:
    Sydney, Australia
    Accounting, Tax and Legal would be a good place to post trust questions.
     
  3. Grar Industries

    Grar Industries Member

    Joined:
    13th Dec, 2007
    Posts:
    9
    Location:
    Brisbane, QLD
    jms,

    I am also a beginner in the grand scheme of things. I have had some success in share trading but I found that shares by themselves were a 'wait and hope' strategy. Options are the perfect accomplice for shares!

    Buy yourself the ASX book on Options and/or read all about them to understand the characteristics of all four parties involved in options transactions (i.e. buyers of calls and puts and writers of calls and puts). The ability to buy and write options is a fantastic feature of this derivative. You can earn income while your shares are doing nothing; or better still, when you don't have any money invested (of course, at the very least, you will be required to meet margin obligations - see the ASX website).

    In depends on your strategy whether you get burnt or not. If you buy or write to speculate good luck to you! If you use options to lock in buying and selling prices that you nominate, whilst earning income, then you're not exposing yourself to any more risk than a normal share trader or investor would. People may disagree with me but shares can move adversely regardless of whether options are traded! If you're prepared for worst case scenarios (and can see a positive side to them), you may as well earn income when things aren't going your way!

    Grar Industries
     
  4. The Stig

    The Stig Well-Known Member

    Joined:
    3rd Dec, 2007
    Posts:
    190
    Location:
    Central Coast NSW
    This is what my accountant says.
    Have your trading and investing in 2 separate entities.

    So that trading is taxed at 30% in a company and your investing receives the tax concessions for holding shares or mutual funds longer than 12 months.

    My advice.

    Read John Burleys 6 levels of investors in Automatic Wealth or Money Secrets of the Rich.

    Brief Overview.

    Level 1 Non Existant Investor or saver. Absolutely no savings or investments of any kind.
    Level 2 Saver. They put money aside and put it in a small term deposit.
    Level 3 Passive Investor. Aware of the need to invest and put money into Superannuation thru their 9% SG. (Middle Class). Always looking for that home run investment. Usually never make the next step to doing anything about investing or gaining wealth.
    Level 4 Active Passive Investor. Puts away 10% of their gross income into an automatic investment plan and lets compound interest do it's thing. Follows Johns 7 Money Habits.
    Level 5 Participating Investor. Part time or Full Time Investors. Striving for 25% to 100% returns on their investments.
    Level 6 Capitalist. Rockefellers, Carnegies, Kerry Packer.

    Share trading and options trading would be level 5 investor. Don't go there unless you master 2, 3 and 4. That's my advice. Otherwise after a loss or 2 you go back to level 3 investor.