05 Oct Property vs Shares? OMG shares are not for the faint hearted!
About the author
Jane Slack-Smith has been named one of the Top 10 Property Experts in Australia by Money Magazine, one of the Top 4 Financial Influencers by Qantas and been awarded the Australia’s Mortgage Broker of the Year twice.
Earlier this year my son sold up his entire Lego ‘portfolio’ and made $1200. He was allowed to spend 15% on himself (he bought a skateboard) and the rest we were going to learn how to invest in shares.
We decided to buy 3 shares, we discussed what would drive growth of share value (this was June 2020) and decided to buy an online finance company and a provider of blood tests. My son on the other hand used a random generator to come up with his share selection.
Seriously! I have to admit I thought I had been leading by example with the due diligence I put into researching property, so his ‘strategy’ hurt.
Well it turns out you have to buy a minimum of $500 batches of shares (see I told you I have no idea) and I convinced him to let his European GPS imaging company with Government contracts to be the one we get rid of. Subsequently the owner of Kathmandu purchased $$$ in the same company, and I haven’t heard the end of it…
Let’s face it investing in something you don’t understand or research properly can be risky, and sometimes throwing the dart against the wall can work but most likely not.
Now since this share journey started in June, I have been getting daily updates on the price of these shares – as you can see below…
Umm, what does this even mean?
Well, I’ll say this… these ups and downs you are seeing have been wreaking havoc on me daily. I see the email come into my inbox and cringe – what will the day bring?
Up or down?
Have I lost money or gained it?
Seriously, check out Aug 27th… this was my standout – there was a 27.48% gain – but then the next week, straight back to where we started at $6.00.
These daily ebbs and flows are doing my head in.
Let’s talk context: I know property – I do research and due diligence. I buy the best possible property I can afford and one that gets to my goals. And then I sit back and relax for 10 – 15 years.
Yes, the market goes up and it goes down – and I don’t really ever know the value of my property until I sell it. But as long as the fundamentals are right, I know I’m about to become an armchair investor.
I just have to let time do its thing.
And let’s be clear: when it comes to property, we are talking about a multi-million dollar portfolio here… So, when it comes to my shares, how much am I dealing with?
Well, I have 18 Sonic and 82 Zip. To give you an idea, this is an entire investment of less than $1500 in value.
And I experience more stress than when I was in my acquisition and renovation stage for all of my properties.
Just like Tom in Jerry Maguire, at the end of the day we want to shout “Show Me the Money”.
Do I have confidence in my shares? No!
I didn’t buy the best share in the health and finance sectors, but CSL was over $250 and I only had $500 to spend, so I just settled on any share I could afford in the general location of health.
Then there was AfterPay, the darling of online finance transactions, but seriously at over $70 a share I could only settle on the $6 option (that’s where my Zip shares come in… hopefully the cheaper underdog wins the Buy Now Pay Later battle… we’ll see.)
Over the years I have spoken to many property investors who knew they ‘should’ buy a house, or they ‘should’ buy in a certain city – but then they just left it to chance – hoping that they got it right, a house in any suburb would do.
Just like my share purchase not the best share in the sector… but any share in the sector will work.
just like any house in any suburb would do. Right?
Just like my share purchase – not the best, but any share in the sector will work. Right?
Well, you don’t have to hope and dream.
I have been investing in property for over 20 years, I have a low-risk methodology that I have taught thousands of students. I see the success of those who just get it. They follow the step by step process and select the right area to buy, the typical property for the area, they do their research so that they can buy under market and then they add value. They make money in 3 ways, when they buy, when they add value, and with capital growth for when they sell.
This is simply my Trid3nt Strategy®
PS If you would like to checkout helpful information then you might find the following useful.
- Borrow My Brain Series. Sometimes you just need a second set of eyes over a property purchase. In this series I talk to investors and first home buyers looking for some help. https://www.janeslacksmith.com.au/borrowmybrain
- Your Home is Your Gold Mine. This series was completed for Australian Women’s Weekly. It shows how your home can be the cornerstone of your wealth https://yourpropertysuccess.com.au/goldmine/
- Are you a first home buyer who is wondering if now is the time to buy? Check out all the resources including the First Home Buyers Show here http://firsthousebuyer.com.au/
- For a collection of all our my courses, podcasts, series and more you can find it all here www.janeslacksmith.com.au