Educational articles

November 15, 2017
Bitcoin Blockchain

What is Bitcoin? Demystifying Blockchain and Bitcoin

There has been a lot of news recently on blockchain and in particular bitcoin. The price of Bitcoin has had an amazing run as it was trading at US$0.39 in 2010 and it currently trading at US$7,387. These terms may be intimidating to the non-tech savvy person so in this article we will explain the concepts of blockchain and bitcoin
November 3, 2017

Stocks to buy with a lower Australian dollar

In the last two months, we have seen the Australian dollar shed nearly 5% to the US dollar. From nearly US$0.81, one Australian dollar is now fetching closer to US$0.77. As the outlook for the Australian dollar turns more negative, investors need to be aware of how this can impact their share holdings. We have previously written on this blog
October 31, 2017

The 9 things you should know before opening a SMSF

The decision to open your own Self Managed Super Fund (SMSF) may be difficult one. It is therefore important to understand the pros and cons of SMSF‘s to help you decide whether a SMSF is best for your current life circumstances.The decision to open your own Self Managed Super Fund (SMSF) may be difficult one. It is therefore important to
October 23, 2017

An Introduction to Fibonacci Retracements

Who was Fibonacci? Guglielmo Fibonacci was an Italian mathematician born in Pisa, Italy in 1175AD who introduced the Fibonacci numbers. He has been hailed as the greatest European mathematician of the middle ages. When Fibonacci was young, he travelled with his father who was a merchant through the Eastern Mediterranean and North Africa. It was during his travels that he
October 9, 2017

Advantages and Disadvantages of ETFs

ETFs gained increased popularity in recent years and are becoming widely used by investors. This has been especially true after the GFC. Despite their popularity, they have not been around as long as managed funds. This means that investors are still unaware of how they work. ETFs are financial products that are similar to managed funds except you can buy
September 29, 2017

A beginner’s guide to writing covered calls

INTRODUCTION A call option gives the holder the right to buy a security at a certain price (the strike price) by a certain date (the expiry date). Writing (selling) options is a strategy used to protect portfolio’s and also pick up additional income. It is ideal for long term investors who want to protect their shares without selling them. Only
September 29, 2017

What you need to know about dividends

Dividends are essentially excess profits the company has decided to distribute to their shareholders. Companies are not obligated to pay out dividends as they may decide to reinvest their profits back into the business. Otherwise they may not have been profitable enough to pay out any dividends. Established companies are more likely to pay out dividends than start-ups. The reason
September 22, 2017

The Pros and Cons of Share Purchase Plans

Investors in the Australian share market at some point or another have been offered a Share Purchase Plan. Companies offer Share Purchase Plans to raise capital to fund a new acquisition. The definition of a Share Purchase Plan is an offer to existing shareholders to purchase further shares. This is usually at a discounted price. Shareholders can purchase up to
September 18, 2017

What type of stocks to buy in a high inflation environment

The world has seen unprecedented levels of money printing since the depths of the GFC. Along with record low interest rates, many investors are concerned that this can only lead to one thing – inflation. When you experience inflation, the value of investments (such as cash) may be eroded. It is therefore important for you to recognise which asset classes
September 1, 2017

Finding Opportunities in a Low Growth Environment

Looking for investment opportunities in a low growth environment can be very challenging as Australian companies are not experiencing the same levels of growth as before. However, there are still opportunities around – you just have to look a little harder. Here we have outlined a starting point on where you need to look in order to discover trading opportunities
August 28, 2017

Tips to avoid losing money in the stock market

Investing in the stock market is more like a marathon than a sprint. It is not a get quick rich scheme so investors should not expect to earn money overnight. Success in the stock market comes from careful planning and education and the ability to stay emotion free when making decisions. See below some tips on how to avoid losing
August 23, 2017

How the IAG chart gave us clues to avoid it

IAG reported today and the share price tumbled. At one stage it was down 10%. In our weekly research that we send to clients, we warned a week earlier that there was something wrong with the IAG chart. The chart was giving us clues that the market did not like the stock. We had recently warned of upcoming weakness in
August 23, 2017

What to Look Out For When Selecting Stocks

Looking at the fundamentals and technicals of a stock is important and there is more information on those topics in this blog on the following links: https://fairmontequities.com/effective-trading-video-series/ and https://fairmontequities.com/a-beginners-guide-to-financial-ratios/. You can also view how we can combine the two here: https://fairmontequities.com/how-we-work/ Alongside these ideas, there are other some other basic factors to look out for when selecting stocks: Ownership: When
August 18, 2017

How we anticipated the 10% drop in QBE

QBE has had a horror week where it is now down 10% from where it was trading only 2 days ago. Only a couple of days before this we put out a chart to our clients with a warning that QBE would fall towards $10.80. At time of writing, that is exactly where QBE is now trading. This short video
August 15, 2017

Is now the time to be adding gold to your portfolio?

Gold is traditionally used as safe haven investment to hedge against a falling market. As the USD dollar market continues to fall, the popularity of gold will continue to rise. The markets have recently been experiencing some very turbulent times of late as tension grows between North Korea and the United States. These factors will encourage investors to invest in