Traders and investors are very different beasts; sure, both are looking for profit, but they go about it in very different ways and each path has a very different route to success.
 
For the investor it is about time; there are numerous different methods to investing but the more time the easier it is. So start today, not tomorrow.
 
For the trader it is about risk and discipline; know your risk, manage it well and always be disciplined. Know when you'll buy, when you'll sell and when you'll sit on your hands and do nothing.
 
If you are a trader and an investor always be very clear on which path you're taking for a particular stock when you are buying. Why you buy it will define when you sell it.
 
In the past week we uploaded the video Simon's Lazy Trading System and it is already hugely popular (including our largest live audience ever). The system is simple and designed for trading indices end of day, with or without gearing. In short it’s an everyman's (or woman's) trading system.
 
In the week ahead we have another live webcast from Warren Peacock on Wednesday at 13h00 - Four Important Candlestick Patterns. There are literally thousands of different candlestick patterns but Warren is focusing on the four he considers most important.

Coming up

Wednesday 9th May at 1pm - Four Important Candlestick Patterns

Wednesday 16th May at 8pm - Traders Setup

Thursday 24th May at 8pm - Other Relative Valuation Models

Recent uploads

Simon's Lazy Trading System

Real live FX trading strategies

Valuations EV/EBITDA Model (case study - FBR)

Money tip

What is your net worth? Do you have a net worth or is it a case of a net debt? A personal balance sheet is critical; otherwise you have no chance of ever being on top of your finances. But fear not, help is at hand in the form of a 100 second tip - Your Personal Balance Sheet.

All the best

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How do you measure your success as an investor? You can't just invest without some way of knowing if you're doing a decent job or not. The easiest way is to select a benchmark, something to compare your performance against; and importantly a benchmark you could invest in, because if you continually underperform your benchmark then you should quit and simply buy the benchmark.

I use the Top40 index as my benchmark as it represents the 40 largest shares on the JSE and I could buy it in the form of the Satrix40 ETF. I then measure my annual performance against this benchmark at the end of every year. I don't always beat it - but I need to beat it more times than not and my three year return needs to be beating the benchmark.

Of course one can absolutely take the easiest route and simply just buy the benchmark. Satrix40 (or other ETF products) are a great way to get exposure to the market without effort or individual stock/ sector risk.

In the week ahead Alwyn Burger will be talking us through his trading setup: how many screens, what charts he watches and the like. New traders always want to know how others do it, so pencil 20h00 on Wednesday in to your diary and watch Alwyn doing this webcast called Traders Setup.

In the past week Warren Peacock did a great webcast on the Four Important Candlestick Patterns. There are literally thousands of candlestick patterns but he's narrowed it down to his preferred four and the video is online for viewing and downloading.

And now for a blatant punt… Keith Mclachlan has started a weekly podcast over at MaudeStreet.com called Irrational Markets. The first show went live last week and he's talking to an ex investment banker on mergers and acquisitions - do they actually work and create value? You'll find it all here.

Coming up

Wednesday 16th May at 8pm - Traders Setup

Thursday 24th May at 8pm - Other Relative Valuation Models

Recent uploads

Four Important Candlestick Patterns

Simon's Lazy Trading System

Real live FX trading strategies

Valuations EV/EBITDA Model (case study - FBR)

Money tip

22Seven has come out of beta and is now open for all. It is a Personal Financial Management tool, which is a fancy phrase to say it helps you understand where your money is going every month so that you can take control of your finances. It scrapes your bank account and gives you nice and clear indications of exactly what you spend where. As an example the founder, Christo Davel, discovered that using other banks’ ATMs was costing him thousands of Rands per year. Now he makes sure he only uses his own bank’s ATMs and he's richer as a result. Check it out and if you're concerned about the security angle have a read of this post and you can listen to an interview with Christo here.

All the best

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Greece is once again hogging global headlines and causing worries from Amsterdam to Zeerust. The reality is that the direct hit to our market and economy would be limited however it plays out, but the fall out would be a massive hit to sentiment and that would hurt us. In truth, Greece doesn't matter; but as always, sentiment is the driver in the short term, so as investors we ignore Greece and carry on looking for opportunity to buy assets that meet our investing criteria.

In the week ahead we have a live webcast from Keith Mclachlan on Thursday at 20h00 - Other Relative Valuation Models. Keith has been going through the major valuation models (Price Earnings, Price-to-Book and EV/EBIDTA) and he'll use this webcast to touch on some of the other valuation models out there.

The past week saw another great webcast from Alwyn Burger as he talked us through his Trader's Setup, with particular attention to MetaTrader4 (MT4), charts used and how many screens are feasible.

Over at MaudeStreet.com I interviewed Mia Kruger about her trip to the Berkshire Hathaway AGM to listen to Warren Buffett and Charlie Munger. It’s a great experience for any investor and she shares some of the highlights and lessons learnt.

Coming up

Thursday 24th May at 8pm - Other Relative Valuation Models

Recent uploads

Trader's Setup

Four Important Candlestick Patterns

Simon's Lazy Trading System

Real live FX trading strategies

Money tip

Credit cards are a terror if we blow them out and end up paying huge interest fees, putting a strain on our cash flow. But they can be very useful as a substitute for cash as they carry little actual risk and transactions are free for the user (as opposed to cash which has a cost to withdraw).

The point is to use a credit card for ones day-to-day expenses - BUT then pay it off in full by the due date. This avoids interest charges and reduces the strain on your monthly debt repayments. Work out how much you'll spend in a typical month (in other words budget), put the money in a savings account (or your home loan) and use the credit card. Then when it comes time to pay the card take the money out of the savings account and pay the credit card debt. This way you earn interest and reduce costs.

All the best

JustOneLap

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So Facebook has listed and is trading 10% below its listing price of $38. The three key lessons here are simple: never believe the hype - always do your own homework. It does not matter how much you use the company and like its products; what matters is the old fashioned things like revenue, profits and future prospects. Thirdly, there are no sure things in the stock market; yes LinkedIn popped some +84% on listing day, Groupon +40% and Pandora +25%, but Facebook only managed a 10% pop on listing and closed down on the day.

I suppose the question is now where to from here for Facebook, and the answer is we have no idea. Having 900 million users is impressive, but a Facebook killer could be launched tomorrow or maybe we'll all still be using Facebook from our old age homes! Either way, I am not a shareholder and don't intend to be one.

In the past week Keith Mclachlan continued to educate us on valuation models with a webinar titled Other Relative Valuation Models (PEG, Price-to-Sales, dividend yield, Price-to-Cash Flow and a number of industry specific ratios). He has done theory and practical videos on PE, Price-to-book and EV/EBITDA, and this video covered the others out there. As always it was a great learning experience.

We are taking a breather in the week ahead as I’m off to Durban and take my nephew and niece to the Royal Agricultural Show in PMB. However we will be uploading a video on the different types of shares (issued, authorised, buy backs, treasury etc.) by late Tuesday.

Over at MaudeStreet.com we uploaded a great interview between Keith and I on traders’ mistakes, covering position size, exiting, expectancy bias and more. You'll find it here.

Coming up

Wednesday 6th June at 1pm - Investment clubs

Wednesday 13th June at 8pm - Sarting in FX

Monday 2nd July at 8pm - Trading commodities without currency risk

Recent uploads

Other Relative Valuation Models

Trader's Setup

Four Important Candlestick Patterns

Money tip

Investment clubs are a great way to pool not only knowledge but also funds, and they provide a way to learn while you invest. Bruce Whitfield had a great interview on the subject with Warren Ingram and you can listen to it here. We will be doing a full webcast on investment clubs on 6 June and you can book to attend here.

All the best

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