First post, very new to the game so looking to pick up as much advice as possible from you knowledgeable folk!
One thing I see time and again, here and elsewhere, is that when a share price decreases it is a good job opportunity to buy, as you get the share cheaper and will reap the reward when it recovers. I understand the logic, as these things are cyclical and the market always recovers.
However, although the MARKET always recovers, of course this isn’t necessarily true of individual companies within the market. So, (and I appreciate that this is, potentially literally, the million dollar question) is there a good method of identifying a “blip”, and therefore a buying opportunity, vs a larger cause for concern from which there will be no recovery?
No, there is not. Otherwise everbody would be a millionaire.
Your summary of the situation, however, was spot on. That’s why large parts of your investments should go into funds or market trackers.
Thanks very much for this @anon810895, this is exactly the sort of response I was hoping for, I want to get to a point where l’m able to apply a bit of analysis and understand why things are happening but I’m nowhere near that yet.
@SebReitz that’s the aim, majority of portfolio in funds and then, say, 20% in individual holdings. I’m planning to focus on dividend rather than capital growth, so would like to be able to identify buying opportunities to maximise capital growth without deviating much from the larger plan, hence my question.
Thanks very much for your responses, if anyone else has any insights to share then please chime in, I’ve got a LOT to learn!
