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When To Buy and When To Sell Stocks?

5 Jun 2021
how to Buy SAB ZENZELE SHARES?
how to Buy SAB ZENZELE SHARES?

Buy SAB Zenzele Kabili at Standard Bank


SAB Zenzele Kabili was listed on the Johannesburg Stock Exchange on May 28, 2021. The listing price was R40, and today it is worth R180. You might be wondering what SAB Zenzele Kabili is? This is a follow-up to SAB Zenzele, the largest broad-based black economic empowerment scheme in South African history that has just been closed out.These shares trade under the full name “SAB Zenzele Kabili Holdings (RF) Limited” with the abbreviated name of “SABKabili” under JSE ordinary stock symbol – SZK

Any qualifying person in terms of the Broad-Based Black Economic Empowerment Act will be able to buy.

Is Zenzele Kabili a good share to buy?

These shares are linked the performance of AB InBev shares, which have been demonstrating steady growth despite the impact of the Covid 19 pandemic.

How to buy at Standard Bank?

Step 1:

Go to Standard bank website by clicking Here and click register.

Step 2

Follow a simple step by step and complete the form.

Step 3

You will get an email notifying you that the application was received.It took few hours for me to be approved and this is the email you can expect.

Step 4

Use the username and password sent to your email to log and below is the expected screen. At the top, you will see a message saying you should send your FICA documents, i.e., proof of address and certified ID copy. You can send your Fica document to this email address and always add your ID number or application or reference number –securities@standardbank.co.za.

Step 5

You will notice that you still can’t buy shares because you are not BEE verified yet. Lucky enough, I have a simple SAB BEE Naturalisation Affidavit 1 page PDF that you must complete form that you need to complete and get the COMMISSIONER OF OATHS to sign. Go to the police station if you don’t have any COMMISSIONER OF OATHS around you. You can download it below.

SAB-BEE-Naturalisation-AffidavitDownload

After signing and getting the COMMISSIONER OF OATHS to sign, you can email the form back to Standard Bank-securities@standardbank.co.za.Standard Bank will send your Affidavit to SAB get approval and confirmation that you do qualify to buy shares. You will get an email confirmation that your account is ready, and you can buy SAB Zenzele shares.

hope you will be able to buy these shares before they shoot to the moon.


10 May 2021

When to sell a stock

  

Theoretically, the ability to make money on stocks involves two key decisions: buying at the right time and selling at the right time. In order to make a profit, you have to execute both of these decisions correctly. The return on any investment is first determined by the purchase price.

One could argue that a profit or loss is made at the moment it's purchased; the buyer just doesn't know it until it's sold. However, while buying at the right price may ultimately determine the profit gained, selling at the right price guarantees the profit (if any). If you don't sell at the right time, the benefits of buying at the right time disappear. 

Many investors have trouble selling a stock, and sometimes the reason is rooted in the innate human tendency toward greed. However, there are several strategies that you can use to identify when it is (and when it isn't) a good time to sell. The most important thing about these strategies is that they attempt to take some of the human emotions out of the decision-making process.

KEY TAKEAWAYS When it comes to investing, the decision of when to buy a stock can sometimes be easier than knowing when is the appropriate time to sell uua stock.In general, there are three primary reasons for a long-term investor to sell: the buy was a mistake, the price has risen dramatically, or the current price is no longer supported by fundamentals.Emotion and human psychology can sometimes get in the way of making a smart decision, so stay attuned to the data (and not your feelings).

There are generally three good reasons to sell a stock. First, buying the stock was a mistake in the first place. Second, the stock price has risen dramatically. Finally, the stock has reached a silly and unsustainable price. While there are many other additional reasons for selling a stock, they may not be as wise of investment decisions.

Volume 75% 1:59  when to sell stocks is Hard Here's an all-too-common scenario: You buy shares of stock at R25 with the intention of selling it if it reaches R30. The stock hits R30 and you decide to hold out for a couple more gains. The stock reaches R32 and greed overcomes rationality. Suddenly, the stock price drops back to R29. You tell yourself to just wait until it hits R30 again. This never happens. You finally succumb to frustration and sell at a loss when it hits R23.

In this scenario, it could be said that greed and emotion have overcome rational judgment. The loss was R2 a share, but you actually might have made a profit of R7 when the stock hit its high.

These paper losses might be better ignored than agonized over, but the real question is the investor's reason for selling or not selling. To remove human nature from the equation in the future, consider using a limit order, which will automatically sell the stock when it reaches your target price. You won't even have to watch that stock go up and down. You'll get a notice when your sell order is placed.

Sell Stock When Buying Was a Mistake

Presumably, you've put some research into this stock before you bought it. You may later conclude that you've made an analytical error, and you realize the business is not a suitable investment. You should sell that stock, even if it means incurring a loss.

The key to successful investing is to rely on your data and analysis instead of Mr. Market's emotional mood swings. If that analysis was flawed for any reason, sell the stock and move on.

The stock price might go up after you sell, causing you to second-guess yourself. It's also possible that a 10% loss on that investment could turn out to be the smartest investment move you ever made.

Of course, not all analytical mistakes are equal. If a business fails to meet short-term earnings forecasts and the stock price goes down, don't overreact and immediately sell (assuming if the soundness of the business remains intact). But if you see the company losing market share to competitors, it could be a sign of a real long-term weakness in the company.

Sell Stock When the Price Rises Dramatically

It's very possible that a stock you just bought may rise dramatically in a short period of time. Many of the best investors are the most humble investors. Don't take the fast rise as an affirmation that you are smarter than the overall market. It's in your best interest to sell the stock.

A cheap stock can become an expensive stock very fast for a host of reasons, including speculation by others. Take your gains and move on. Even better, if that stock drops significantly, consider buying it again. If the shares continue to increase, take comfort in the old saying, "No one goes broke booking a profit."

If you own a stock that has been sliding, consider selling on a so-called dead cat bounce. These upticks are temporary and usually based on unexpected news.

Sell Stock for Valuation

This is a difficult decision: part art and part science. The value of any share of stock ultimately rests on the present value of the company's future cash flows. The valuation will always carry a degree of imprecision because the future is uncertain. This is why vcash flows. The valuation will always carry a degree of imprecision because the future is uncertain. This is why value investors rely heavily on the margin of safety concept in investing. 

A good rule of thumb is to consider selling if the company's valuation becomes significantly higher than its peers. Of course, this is a rule with many exceptions. For example, suppose that Procter & Gamble (PG) is trading for 15 times earnings, while Kimberly-Clark (KMB) is trading for 13 times earnings. This is not a good reason to sell Proctor & Gamble, considering the sizable market share of many of their products.

Another more reasonable selling tool is to sell when a company's P/E ratio significantly exceeds its average P/E ratio over the past five or 10 years. For instance, at the height of the Internet boom in the late 1990s, shares of Walmart had a P/E of 60 times earnings as it opened up its first website with e-commerce. Despite Walmart's quality, any owner of shares should have considered selling and potential buyers should have considered looking elsewhere.

When a company's revenue declines, it’s usually a sign of reduced demand. First, look at the annual revenue numbers in order to see the big picture, but don’t rely solely on those numbers. It's also a good idea to look at the quarterly numbers. The annual revenue numbers for a major oil and gas company might be impressive annually, but what if energy prices have fallen in recent months?

When you see a company cutting costs, it often means that the company is not thriving. The biggest indicator is reducing headcount. The good news for you is that cost-cutting may be seen as a positive, at least initially. This can often lead to stock gains. This shouldn’t be seen as an opportunity to buy more shares, but rather as a chance to exit the position before any subsequent plunge in value. 

Sell Stock for Financial Needs 

This might not count as a good reason to sell a stock, but it's a reason nonetheless. Stocks are an asset, and there are times when people need to cash in on their assets.

Whether it is seed money for a new business, paying for college, or purchasing a home, this decision depends on an individual's financial situation rather than the fundamentals of the stock. 

The Bottom Line

Any sale that results in profit is a good sale, particularly if the reasoning behind it is sound. When a sale results in a loss with an understanding of why that loss occurred, it too may be considered a good sell. Selling is a poor decision only when it is dictated by emotion instead of data and analysis.

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10 May 2021
road block
road block

WHEN TO BUY OR SELL STOCKS

   

For investors, finding a stock to buy can be a fun and rewarding activity. It can also be quite lucrative – provided you end up buying a stock that increases in price. But when are you supposed to actually go in and buy shares? Below are five tips to help you identify when to purchase stocks so that you have a good chance of making money from those stocks.

KEY TAKEAWAYSA with many things, timing is everything when it comes to trading and investing in the markets.Analyzing when to a buy a stock can be tricky, but getting in when the getting is good can enhance your returns.Here, we go over a few common strategies for when to buy a stock to give you the best chances of capturing a winner.When a Stock Goes on Sale

When it comes to shopping, consumers are always on the lookout for a deal. Black FridayCyber Monday and the Christmas season are prime examples of low prices spurring voracious demand for products. However, for some reason, investors don't get nearly as excited when stocks go on sale. In the stock market, a herd mentality takes over, and investors tend to avoid stocks when prices are low.

The end of 2008 and early 2009 were periods of excessive pessimism, but in hindsight, they were also times of great opportunity for investors who could have picked up many stocks at beaten-down prices. The period after any correction or crash has historically been a great time for investors to buy at bargain prices.

If stock prices are oversold, investors can decide whether they are "on sale" and likely to rise in the future. Coming to a single stock-price target is not important. Instead, establishing a range at which you would purchase a stock is more reasonable.

Analyst reports are a good starting point, as are consensus price targets, which are averages of all analyst opinions. Most financial websites publish these figures. Without a price target range, investors would have trouble determining when to buy a stock.

When It Is Undervalued?

There is a lot of information needed for establishing a price target range, such as if a stock is being undervalued. One of the best ways to determine the level of over- or undervaluation is by estimating a company's future prospects for growth and profits.

A key valuation technique is a discounted cash flow (DCF) analysis, which takes a company's future projected cash flows and then discounts them back to the present using a reasonable risk factor. The sum of these discounted future cash flows is the theoretical price target. Logically, if the current stock price is below this value, then it is likely to be a good buy.

Other valuation techniques include looking to a company's dividend growth and comparing a stock's price-to-earnings (P/E) multiple to that of competitors. Other metrics, including price to sales and price to cash flow, can help an investor determine whether a stock looks cheap compared to its key rivals.

When You Have Done Your Own Homework?

Relying on analysts' price targets or the advice of financial newsletters is a good starting point, but great investors do their own homework and due diligence on researching a stock.

This research can include reading a company's annual report, reading its most recent news releases and going online to check out some of its recent presentations to investors or at industry trade shows. All this data can be easily located at a company's corporate website under its investor relations page.

When to Patiently Hold the Stock

Assuming you've done all your homework, properly identified a stock's price target, and estimated if it is undervalued, don't plan on seeing the stock you bought rise in value straight away. Be patient. It can take time for a stock to trade up to its true value. Analysts who project prices over the next month, or even next quarter, are simply guessing that the stock will rise in value quickly.

It can take a couple of years for a stock to appreciate close to a price target range. It would be even better to consider holding a stock for three to five years – especially if you are confident in its ability to grow.

The Bottom Line

Legendary stock-picker Peter Lynch recommends that investors buy what they know, such as their favorite retailer at their local shopping mall. 1Others can get to know a company by reading up on it online or talking to other investors.

Combined with the above tips, applying your common sense in choosing when to buy a stock can produce the most profitable results. To jump into the stock trading or investing world, you'll need a broker.

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