Managing your share portfolio

Arguably your most important function as an investor is to monitor and manage your shareholdings.

Monitoring your portfolio

When you become a shareholder keep an eye on how your shares are performing. Depending how interested you are, check the previous day’s close or monitor share prices (delayed 20 minutes) by searching on your company by CODE or NAME above. The newspapers can generally also provide you with the highest and lowest sale price of the day, the 52-week high and low, PE ratios, and dividend yields.

Much of the basic data you need to monitor your portfolio is also available on our own site. Many of the broker websites also allow you to set up a watchlist or portfolio so you can monitor the ups and downs.

Managing means more than just monitoring share prices and keeping records of purchases, sales, dividends, bonus issues etc. It also means watching your companies (yes they are partly yours).

Managing your portfolio

Each listed company has to disclose information to the market that is material to the value of its shares as soon as directors and management become aware of that information. So if company personnel are aware of information that might persuade a reasonable investor to buy or sell shares, they have to get it out in the market place.

Companies do that by way of formal announcements to ASX which are immediately released to the market. All investors are then equally aware of and can trade on the information. That's the theory. In practice there are just too many unexplained movements in share prices prior to the release of data and announcements are often just marketing blurb. The ASX Announcements platform is often used rather cynically at least by many of the smaller company boards for self-promotion and advertising.

We have not yet seen a market release to the effect that "directors are pleased to announce the successful appointment of liquidators to the company, a step they believe is in the best interests of shareholders and one that will greatly assist in preserving and enhancing shareholder value", but we have seen some that go close!

As a shareholder, you can even put pressure on companies to perform. Consider going to company AGMs and asking questions or getting the Australian Shareholders' Association to represent you.

In the long run, share prices reflect underlying company performance; if your companies are financially healthy so also your portfolio. Keep a weather eye also on the broad picture of how the economy is going (see sources of various economic commentaries below). Remember there is always a huge diversity of opinion as to the direction of the local and global economy.

  Change of address:   

Yes this is vital. You can update address changes (you will need your SRN or HIN) for most registries online. (first check which registry your company is with, by entering the code or name in the SEARCH facility above)

FURTHER READING:

• Economic reports - Westpac
• Economic commentary - NAB
• International research - ANZ
• Economics - CBA
• Publications - Reserve Bank