ASX Shares No luck with Woolworths shares (WOW)

i rushed in earlier this year to buy Woolworths shares... @26 each !
They're now about $23 something .

If i had my time again I probaly would if used that 100k for a deposit on a property.

I cant sell yet as im hoping they"ll go back up !

Its a bit like gambling I suppose .

 

Was your plan to hold short term?

 

WOW have increased their dividend progressively for a long time. Like BHP, I can see a retrace of their dividend in the early year, and the market will react accordingly.

I feel they will bumble along sideways until their Masters problem climbs out of its hole. Currently that's their money pit.

pinkboy

 

Sell up big time and use the loss to offset the capital gains when you sell at a profit.

 

I own them too, bought them at a much higher price than you. They are being severely tested by the ever expanding ALDI. I am holding them for their dividends. You can also reinvest their dividends (DRP) and buy more shares at a lower price.

 

Given the price fluctuations,and a lot bought in above that price range and from the numbers i look at ,some 25000-50000 shares thinking that the share price was trending upwards again,only too find unit prices can fall quickly ,full time professional traders would see this each week,and if you are relying on market volatility to make money ,it is also important to have another source of income to offset the capital loss..imho..

 

so you bought less than six months ago at 26, and you are panicking about what is at todays price a c.5% drawdown.

don't buy shares.

 

Even scarier, that 100k pesos - how much of that is capital used as a percentage?

pinkboy

 

Could have bought 8 caves in lightning ridge for that!

 

Hope does not seem to be a very good reason to hold an investment.

 

100k punt on WOW a very bold, dare I say Chinaesque play, going for maximum concentration.

 

You're getting a yield of ~5% on those shares, that's not bad at all and above what you'd expect to get on property, plus, surely if the other option was buying property you bought them as a 5+ year investment anyway?

 

For some real character building perhaps Dick Smith and Slater & Gordon would have been better choices.

Seriously though $26 down to $23 something is nothing in the world of shares for a longer term investor. However if one taking a short term punt without risk and money management strategies in place or no clear objective then it is one of those lessons in life! But many of us have been guilty of such things on our journey of attempting to build wealth. Better to learn from these mistakes in the accumulation stage than later in life and/or especially when retired!

In regards to Wollies grabbed some around mid $23's during the depths of the GFC and thrilled to grab some more recently @ $23.10. If they tank well below recent purchase then will grab some more. Rough times ahead for them but personally very happy to own as a long term income focused investor.

 

"Masters"

 

+1

 

Did you use the everyday rewards card when buying the shares? Could have offset your losses

 

Yes and Big W.

Fair enough but WOW also own some excellent assets which is what I see and management will sort itself out going forward. So much short term focus nowadays which may be fine if one is a trader or having to report quarterly ... . But thankfully as a long term investor I have the luxury of being able to ignore the day to day noise. And more importantly as an income focused investor it is an even greater luxury to be able to disregard the huge number of market partipant's and media's obsession with the capital (vs income) aspect of shares.

Think Wollies has problems well perhaps spare a thought for Wesfarmers who having paid too much for a run down Coles then trying to turn it around during the GFC. Didn't stop me buying WES as cheap as I could during the GFC despite a monumental task ahead for the company. Long term focus, buying good companies and listed funds etc when they're on the nose either due to short term focus or overall market pessimism, diversification and sticking to those likely to reward us with a steadily growing income over time makes for a relatively stress free approach to investing.

Last night I replied to a thread elsewhere which was lamenting at the woeful and somewhat depressing performance of shares during 2015. All I can assume again the focus was on capital performance as we were thrilled with 2015 - our income from shares was better than ever not to mention some great buying opportunities in recent months!

 

"IF".

 

Woolworths needs to seriously turn a few things around, take some drastic measures. Until then they will lag..

Even for a "long term investment", always set a stop loss if your buy price proves poor. Losing $500-1000 hurts, but so does sitting on shares for 2 years until they turn around because you thought it was a good idea at the time. Yield, pft, plenty of other blue chips that will gain sooner and have similar yield.