My Personal Investment Strategy

Today I would like to talk about my investment portfolio that I have recently created. This is all factual and provides insight into my investment plan, strategy and purchases to date. I hope that sharing this information with you will give insight into the merits of stock market investing.

I decided that I would manage my own portfolio, as such I signed up for a Direct Shares account with St.George bank (which uses the E-Trade Platform).

At the time of investment, (September 2007) I was well aware that there was financial woes in the United States that was creating a backlash on the Australian stock market. I watched the stocks I wanted for around a month unsure of whether to buy now or when the ‘recession’ hits. I decided to bite the bullet and invest, with the following action plan;

1. I did not invest totally in the financial sector.
Doing this meant that I would not be as effected by any sub-prime mortgage crisis that was glooming. In saying this, I do have shares in a few banks ranging from Westpac to Suncorp Metway.

2. I diversified my portfolio with conservative stock.
I did this through purchasing BHP Billiton shares. Low growth, but maximum security and good dividend yield. My plan with these shares is to re-invest the dividend constantly to acquire more stock and growth in the company.

3. I made only one speculative stock purchase.
This came in the shape and form of Suncorp Metway (SUN). A new bank in Australia that has potential to become the next St.George (anyone remember when St.George shares were $3.50? They are now $33.50 and rising rapidly).

What is my plan you might ask?
Hold my portfolio for 5 years and re-evaluate at the end of that. I intend to ride the storm of sub prime and potential US recession that directly damages the Australian stock market so that hopefully I will come out on top. The stocks I have listed above are what I currently hold, and I intend to purchase more while they continue to drop over the next 2-3 months. I have a number of other reasonings behind my investment plan that go beyond just buy and hold, as I did a lot of background research into all my company purchases and do not want to bore you by listing them.

What is my end investment goal?
To have a substantial holding in BHP and WBC over the next 5 years, and to diversify slowly but surely into more financial companies. In my 5 year investment plan, I also wish to double my net worth in shares, which for privacy sake I wont list.

What is rated BUY right now for me?
My current hit list of stocks I want (as of 06/02/2008) include the following:
- Westpac Bank (WBC)
- Macquarie Group (MQG)
- BHP Billiton (BHP)
- Suncorp Metway (SUN)

I have more stocks that I am keeping an eye on, but to date have not confirmed whether they are good or bad investment ideas, so will continue to research and keep you all posted.

So what now?
I strongly encourage any readers to post their thoughts and possibly what kind of stocks they own on the ASX or US Stock Exchange. Let me end this post with two questions for you;

1. What is your investment strategy?

2. What stocks do you see a future in?

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