Investment expert reveals ten tips for investing in penny shares

Simangele Mzizi, 30 Jan. 2013

Tags: shares, share, investing, penny shares, invest, share portfolio



Knowledge is power. And learning from industry experts who have a wealth of knowledge is one way to learn about penny shares. But, in the end, it’s you who will decide the best system to invest with success. Here are ten tips by Red Hot Penny Shares’ Chief Investment Strategist, Francois Joubert, that’ll help you along the way…

Penny shares are great for the private investor, especially since buying shares in small companies is cost effective and easy. With that said, you still need to learn the tricks of the trade to master investing with success.
 
Investment expert gives you ten tips for investing in penny shares 
 
1. Pay attention to what the market is saying. “Markets are never wrong in the final analysis, so pay a lot more attention to what the market is saying than to what the madding crowd says. The bottom line is the share price and not your or own opinions of what it should or should be,” says Joubert.
 
2. Be careful who you listen to. Don’t be quick to take advice, especially if it contradicts your own research or feel for a share. Be wary of the opinions of those with vested interests like market professional and brokers.
 
3. World renowned investor, Warren Buffett says: “Be brave when others are afraid and afraid when others are brave.” Joubert shares the same sentiments and adds that you should be flexible and ready to change when circumstances demand.
 
4. Don’t be complacent, confident and arrogant. “Humility before the market is a fine trait. It gives you clear sight. Pride and arrogance blinds you. It’s far better to humble yourself before the market than to have it humble you,” Joubert advises.
 
5. Manage your portfolio. You should have eight to ten shares in your portfolio. If you have too many, you’ll be more exposed to the overall market and will be unable to beat the averages. If you have too few shares in your portfolio, your risk exposure becomes greater.
 
6. Don’t fall in love with your shares. This will be hard if you get attached too easily, but you should simply “use them and lose them. Don’t be afraid to cash in when your objectives have been met. When a share goes against you, ditch it and get into something better,” says Joubert. “A weak heart and volatile shares don’t mix,” he adds.
 
7. Look for vibrant and exciting companies. You should understand the company you’re investing in and understand its business model to invest wisely.
 
8. Look at the bigger picture. “The sector in which the share is listed will reflect the direction of most of the constituents of the sector. If the sector as a whole is turning down, you can be sure the shares within will go the same way,” warns Joubert.
 
9. It’s often said that patience is a virtue. So be patient. Sometimes it’ll take a bit of time until you make large gains. Remember, that a temporary downturn in the market is a normal thing, ride it out.
 
10. Aim for financial independence. “People who just work for money never get above their needs, but if your money is working for you also, you have a far greater chance of getting to that place of independence,” concludes Joubert. 
 
By putting these tips into practice and following your own investing strategy, you’ll be able to invest in shares with success and make significant financial gains.
 

Related QA

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jchiosa asked:
hey guys, i am subscribed to pennyshares. end of last month, didn't receive any communication from you guys. login at fspinvest.co.za does not [read more]
Published at 08 Aug. 2017 in: Penny Shares Francois joubert --- your neck on the line here. 1 Answer
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philrina asked:
Is Francois out of the office / overloaded or simply not interested as he does not answer the questions that I have put to him on 13/6/2017 and my [read more]
Published at 29 Jun. 2017 in: Penny Shares Selling ? holding 2 answers
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vmtimde asked:
HI Francois Please assist me in cancelling my subscription to pay monthly for red hot penny shares. I am not interested anymore. Kind [read more]
Published at 11 May. 2017 in: Penny Shares Cancel debit order 2 answers
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oliviees asked:
Dear Francois, According to the April 2017 RHPS newsletter one of the companies recommended as a buy is ‘Anchor Group’. With the sharp drop in [read more]
Published at 06 Apr. 2017 in: Penny Shares Buy decision 2 answers
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Fielix asked:
Hi Francois, Prescient's share price dropped from 100c to 22c very suddenly. Can you please explain what happened, and if we should still hold on to [read more]
Published at 07 Mar. 2017 in: Penny Shares 1 Answer

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