The last 2 and a 1/2 weeks have presented a real opportunity to top up ones portfolio holdings and buy other shares. There is always the debate around timing the market fall, and falling knives versus time in the market. Traders try to time the market and given the number of failed traders they are poor at timing the market, so you have to decide are you a trader or are you an investor. If you are an investor then you are in the market for pretty much a life time, your approach needs to be sensible and if the counter you are in fails to perform over an extended period then dumped the counter and use the loss to offset CGT with SARS. One can also have a percentage of your total funds in speculative shares some advocate 10% but my personal limit is no more than 5%. Typical example I hold 1.5 bar Nutrition shares as speculative shares representing 1% of my portfolio bought at 1 cent and they have dropped to 2 cents today from 3 cents - should I sell and take my profit of some R 14,500 - absolutely not, also I would not be able to dump the whole lot in one sale so my cost of selling in dribs and drabs will erode my profits considerably. I have an instruction in the market to sell at a price considerably north of its current price which when it hit this number will net about 10 times my current profit. The essence of this post is sit it out and hold on to your value shares and buy more in the dips as generally the better shares reclaim their previous high quicker than the rats and mice. On the debate around property and resources a week before the drop in resources counter that I held I sold out of everything, and, I don't hold nor have I held for decades property funds
So this works for me but will not work for everyone
Just as an aside Coronation have written to all holders of their Top 20 fund to have the rules amended whereby they can invest in a wider range of shares and not restrict their choices to the top 50 companies on the JSE - should improve the value of the fund immeasurably
