My Investment Secret #1 – Invest where the real gains are found
Just suppose in 2002 you inherited R15,000. So you decided to put it to work in the stock market.
If you weren’t sure what the best place for great gains was you might have decided to go for a safe approach and split your money into three main categories.
You invest R5,000 in the property market; another R5,000 in a broad range of large cap companies and you invest the final R5,000 in the very smallest shares on the JSE, penny shares. Let’s jump forward to 2012.
Today, assuming you had achieved an average return from these different asset classes – your first R5,000, invested in property, would be worth R13,505. Not bad!
Not as nice as the R5,000 you invested into large company shares, though. That would be worth R20,707. How’s that for outperformance!?
But here’s where it gets really mindboggling.
PowA! penny shares would’ve turned R5,000 into R74,418 in 10 years!
The R5,000 you invested into those little penny shares would be worth a staggering R48,540. Wow!
That’s amazing considering this result is based on the small cap index average performance!
But if you were holding a portfolio of carefully selected winning PowA! penny shares, like the ones in the Red Hot Penny Shares PowA! Portfolio your R5,000 would’ve grown to around R74,418 in the last decade!
My Investment Secret #2 - Follow the story for exponential gains
So now you know, you have to put your money in penny shares to get truly amazing performance. And to get exponential gains you have to target a special – select group of penny shares. Like the ones I pick for our PowA! portfolio.
My PowA! strategy looks at a number of factors, but the most important one to me is the Wow Factor!
Ultimately, this factor is “the story”.
If a share’s likely to perform well, it’s usually one with a great story behind it.
The story could be the restructuring and refocusing of the business into a new, niche market or it could be a tale of recovery from the brink of a disaster. (Take note, the pin-striped brigade often despises and overlooks these recovery stocks.) The story could even be about a new acquisition, an exciting expansion into new countries or simply a spectacular exploration find.
The story is the catalyst that’ll drive massive gains going forward. And without this your investment is doomed.
My Investment Secret #3 – The price is everything
You don’t want to buy into a share once the story’s over. You want to buy it while it’s still cheap. That means you’ll have to invest in a share before you can be sure how its story plays out – but the risk is well worth the returns you could pocket in a short time! My Profit Potential Indicator will tell you exactly what the share I’m looking at is really worth. It’s as simple as that to identify a real bargain!
My Investment Secret #4 – Keep your eye on the goal
Once you’ve found a share with a story you like. And great profit potential there’s only one important thing left to do. You need to keep your eye on the goal: That’s the target price for the share.
You have to keep in mind the story or catalyst that made you buy the share and as long as this story is still playing out – or has a good chance to play out, you hold onto the share.
If you bought a mining company because of a big new mine it would develop and the company announces it doesn’t have the cash to continue developing the mine – then there’s no use holding on. But if it says development is on track then it’ll be worth the holding on for six or twelve months you’ll wait for the share price to shoot up!
By following this secret you won’t sell too quickly, or hold on to losers for too long. Remember, just because your share’s having a bad day doesn’t mean you should sell it.
Stick to my four investing secrets and you’ll be well on your way to PowA! Penny Share profits!
*********** Advertisement ************