JDFP - Diversity by Design

Investing in the Share Market

Investing in the share market can be done in several ways, you can purchase them directly when a company floats (for example CBA, Telstra, Suncorp and more recently Medibank) or you can buy them via a share broker such as CommSec. The last option is you can buy them indirectly via a managed fund.

Each method has its pros and cons, so call us at Jason Dawson Financial Planning (JDFP) we are happy to discuss direct shares and any other investments.

Below are Plain Talk Guides produced by Vanguard that you may find interesting.

(Click to Open - Source is Vanguard Investments Plain Talk Booklets)

Also keep in mind the negative side to investing, its all to easy to forget the bad times when everthing is rolling along, the following image shows the volatility in the market

(Click to Enlarge - Source Vanguard Investments Volatility Chart)

Approved Stock Brokers

Comsec is one of the most used brokers and provides two levels of service with access to large amounts of data and a website that is simple to use.

ETFs and LICs

This is a form of share investing, Exchange Traded Funds (ETFs) and Listed Investment Companies (LICs) both of these operate on the same style of investing and usually come with a management method similar to that of a managed fund. While they are listed shares on the local ASX market, they in turn invest in to many other companies, for more information click here.

Derivatives

Derivatives, are when you start using your vehicle in an off road setting, there are a wide variety of derivatives but in essence you no longer betting on the company as a whole just one aspect of it, and therefore substancially increases the risk and volatility.

Share derivatives (Options, Warrants, and Futures Contracts) are the most common, where you purchase the "right to buy" or the "right to sell" a particular share. Think of it as something like lay-by for the share market, you dont own the share yet just the ability to pick it up later.

Many fund managers use currency derivatives as a means of risk control, and prevent damage to the investment value by a changing exchange rate.


For those interested the ASX does run a free seminar series for investors to meet and hear from senior management of ASX-listed companies across a variety of industries, check the current listed seminars and register your interest here.