When buying shares, how much should you pay?

Discussion in 'Stocks & Derivatives' started by ShinyStuff, Jan 16, 2013.

  1. ShinyStuff

    ShinyStuff New Member

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    Whenever a price is quoted it is the final price for day. Cool. But, when you go into it in more depth, you realise that you can post shares at a higher or lower price to sell. Can you ask to buy at a cheaper price??

    I am a total noob to BUYING shares. Although I owned some shares when I was an employee of a comp, given as a bonus, and they are long gone now. Am looking to buy very soon, and was not sure what I should do.

    If you can buy cheaper, do people usually sell to you??

    Thanks in advance.

    Shiny.
     
  2. finicky

    finicky Well-Known Member Silver Stacker

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    Each day has an opening (the price of the first transaction of the day), a close, a high and a low. Sometimes these can all be the same, but usually there is a 'range' between the high and low. As a buyer you want to get a bid filled as low in the daily range as possible. As a seller you want to get your offer accepted as high in the daily range as possible.

    You can set your bid as low as you want and wait up to a week or more to see if it gets filled. Some buyers are not anxious as to whether their bid gets filled so they lodge a 'stink bid'. This is a bid set so low as to be ridiculous at the time, but sometimes a panic will see sellers accepting any bid at all, and the stink bid gets filled.

    If you really want the stock you have to be realistic and set your bid fairly high in the bidders' 'queue'. The only way to fully get it is to dive in and buy something, but buy something relatively safe as a newbie - a quality company with a well known name that pays a decent dividend. Do NOT buy junior mining companies.
     
  3. Holdfast

    Holdfast Well-Known Member Silver Stacker

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    Sure you can ask for a cheaper price, just place a bid at the price "you' are happy with.


    Many people use an on-line broker like Commsec to trade shares.

    https://www.comsec.com.au/

    Have a browse on the web site for a few days to get a feel for things and then.... perhaps open an account.

    Edit

    Here's an example of Bids for Newcrest today.

    Your bid price can be what ever you like as long as the total some of money involved is commensurate with the brokers minimum.

    For example, some brokers will not make a contract under $500 so that means you have to spend atleast 500 bucks.

    An example:

    Todays high price of $22.74

    Lets just say you bought 25 shares @ $22.74. That's $568.50 plus you have to pay GST and Brokerage fee.

    The actual share "cost" price is over $500 so a broker would probably approve of your contract.

    Anyway, I've probably included too much info but use it as a guide if you like.

    DYODD :)

    [​IMG]
    https://www2.comsec.com.au/Private/MarketPrices/QuoteSearch/QuoteSearch.aspx?stockCode=NEWCREST
     
  4. trew

    trew Active Member Silver Stacker

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    When you place your order you can either buy 'at market' or 'at limit'.

    If you specify at market your order will be filled immediately at whatever the next seller is asking for at that moment.
    If you specify a limit price then your order goes into the queue at that price and waits.
    If the market moves down to your price and sellers sell at that price then your order will get filled.
    if the market moves the other way your order may never get done at all.

    Some brokers will let your order sit there for up to a week, some might cancel the order at the end of the day.
     
  5. Holdfast

    Holdfast Well-Known Member Silver Stacker

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    ^^^Just adding to your comment trew.


    Expiry for this contract "could" be for a month - 15 Feb 2013

    [​IMG]
     
  6. ShinyStuff

    ShinyStuff New Member

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    Wow, you guys/gals are the best.

    My commsec acct was approved today, and sadly their tutorials don't work on an ipad. Duh! Thanks for the advice on NOT buying the jnr mining stocks.. They are so temptingly cheap.

    I subscribe to several mags and they have their suggestions. I find it quite funny how the experts are so hit and miss. They have article in one mag that arrived today and it showed fifteen (i think it was that many) who gave suggestions at the start of 2012 and then showed their end result. So many bummed out a lot... One professional was -63% and this guy does it for a living. It goes to show that stocks are a funny game.

    I really Appreciate everyone's help, i think i understand it much better.

    Shiny.
     
  7. trew

    trew Active Member Silver Stacker

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    Better off getting advice from your cat .....

    http://www.theage.com.au/executive-...es-experts-in-shares-game-20130115-2crbz.html
     
  8. AngloSaxon

    AngloSaxon Active Member

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    That tells me: Don't buy shares in Apple.
     
  9. silver sultan

    silver sultan New Member

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    I'm looking at buying shares in oil exploration company's and various mining and junior mining ??? Why avoid them ?? Please explain
     
  10. ShinyStuff

    ShinyStuff New Member

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    I think i was advised to avoid them because they are hard read. Often they y they will dig in xx months, which drags out... They need more money... Etc etc all the while not paying dividends.

    I am looking at one small miner... It is a risk... Am still deciding.

    Shiny
     
  11. finicky

    finicky Well-Known Member Silver Stacker

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    Short answer:
    Because the managements of these companies are liars and out to rip you off. Read on if you want to get bored.

    against my better judgement:
    silver sultan, I tried to make money in that sector for over a decade and lost it instead. That makes me a little prejudiced of course, but ask yourself in your own self interest, why you would do better? I lost because of bad luck, inexperience, stupidity, and the fact that I am more an investor than a speculator - I seldom took profits or cut losses. My goal was to buy something and hold it for a long period and make money from its expanding profits and free cashflow. My goal has never (or rarely anyway) been to make money from a bigger fool.

    Are you more experienced than me and more lucky than me? Is your project to make money from another punter rather than from profits and free cashflow from a company's operations? If so have a dabble.

    But what are you going to base your speculation on? I can tell you with utter certainty - you are going to base your speculation on an evolving story from the management via their public announcements (or maybe a tip from a friend, article, or forum poster). Or possibly you are going to base it on a chart pattern.

    You are never going to base your speculations in this sector on true facts. Even the factual report of a rich drill intersection carries an implication that it is going to lead to a profitable mine or oil well in the future. The reason for buying/holding is only about future predicted outcomes. Nine times out of ten these outcomes never happen. This sector is choc-o-bloc with unpredicted disastrous events.

    There is no reliable earnings record to rely upon, so the faith of the speculator always stems from what the management is saying about future prospects, and the managements of these companies draw their $300,000+ salaries from share subscriptions. There's also the value of the free options to protect. Management is going to tell you as little as possible about the risks and emphasize to the max the tattslotto dream; so that you buy and do not sell the shares.

    In short they are almost all liars in the sense that a salesman is a liar, or a politician wanting to get reelected is a liar. Lying is part of their livelihood and it molds the story they are telling you about the future. They wan't you to take all the risk, while they reap the salaries/fees and get a free ticket from options. They are almost white collar criminals but inhabit the same class as those who make the laws and regulations. Good luck but I'll stick to profit making non resource companies.
     
  12. Holdfast

    Holdfast Well-Known Member Silver Stacker

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    ^^^^Aint that the truth!

    Good post finicky :)

    Reminds me of all the BS that came out of the management of Bendigo Gold Mines (ASX code BDG) back in 2002. :rolleyes: :D
     

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