We trade on the US (New York) and Australian Stock Exchanges.

The way I see it is the Australian market represents 2% of stock market opportunities, therefore missing 98% of market opportunities. To find say 40 good Australian stocks that will provide strong growth is almost impossible without recommending small illiquid companies, which creates problems with buying and selling.

Our results over the years would not be anything like they are if we were recommending Australian only stocks. Our competitors agree and most of the better newsletters also now offer international stocks as well, because that’s where the growth is. We were the first in Australia to do so, so we were a little ahead of our time in this regard.

Sure, if you only wish to invest in Australian stocks, do so by all means, but don’t expect results as high as our previous returns. I have said many times over the years, we are all about getting the best results we can for you, we are not always successful, but over the long-term we have demonstrated consistent profits and that’s due to our international stocks, to a great extent.

The other thing I don’t like is half yearly reporting. 6 months is a long time to wait to find out how business for your company is. The US reports quarterly making analysis easier and reducing risk greatly. It’s not all about just profits; it’s also about reducing risk. Hence the reason I don’t invest in mining companies (currently) that make up half the market in Australia. I see enormous risk to your money there at the moment.

Consider this for a minute the Australian stock market has very little exposure to global growth outside of commodities. It has virtually no exposure to technology, biotechnology, aerospace, heavy industry, consumer discretionary and automotive as well as a number of other industries. It’s very limited and when you consider the most liquid companies (easy to buy and sell) are all in the ASX200 you are down to just 200 companies we could reasonably consider for recommendation, then remove the mining companies, which we are concerned about at the moment, and what do you have left? Stocks that are already widely owned by super funds, SMSF’s and institutions.

This is when you have to seek opportunities that carry higher levels of risk and this when I ask myself is there a better investment I could recommend to my subscribers? The answer is always yes, but often the best investment doesn’t come from Australia. Stocks like our US picks will probably outperform most ASX 200 stocks with less risk. Never forget the importance of risk. Balance sheets and cash flows as well as wider and larger markets do matter when considering long-term growth.

So, in sum, if you wanted to buy a nice safe Australian portfolio, I’d say you’ll probably never out perform the market and your portfolio will probably not achieve any financial goals that you may have. To do better, you have to add some risk and consider not just the 2% of Australian stocks available, but also the other 98% of opportunities that are available globally. Diversification of our Australia stocks is important, but so too is making money, investing globally will provide both.

We have proven, year in, year out, that having an Australian Stocks only investment policy doesn’t offer the returns of a “global outlook”. By expanding the market in which we seek opportunity we can negotiate around stock market “mini-disasters" like the “Resources Super Profits Tax”.
 
As the only other market we trade on is New York, we can expose our subscribers to some of the world’s best companies. Restricting your investment opportunities to just one small market carries greater risk than investing in truly global companies. You get exposure to growth regardless of borders and at the end of the day growth means higher earnings and higher earnings means a higher share price.
 
Owning shares of a company like Apple is far less risky than say, owning Telstra because of financial strength, market size, consumer popularity, management etc. – all factors we analyse when selecting our shares.
 
Also, using our broker (but you don’t have to) you’ll find the brokerage is cheaper than when buying Australian shares. We also show you ways to manage foreign exchange risk quite effectively too.

We will hold them forever if they keep going up. We may hold the first stocks we ever put into the portfolio - though we may have probably bought and sold it 5 times during the preiod as different opportunities present themselves.

We allow our stocks to enjoy the lifts we predict and then move on when we feel they have reached their current potential. We often revisit them as new technology or growth trends puts them back on our radar.

Though we are not "buy and hold"  - the GFC has changed the investing landscape and that theory is no longer appropriate - now we are "buy and watch". We still take a long term approach and but will sell a position when we feel there is no further value or we have a better place to place the funds.

We are not day traders or speculators. We are investors.

Australian and Global, usually around 40/60% but can be anything, like even 20%/80%, depending on the opportunities and the economic circumstances at the current time.

Our recommended full service brokers in Australia are able to set you up with an account you to trade online through the links on our Broker's details page. They will offer you a discounted rate and a choice of two platforms. You can also speak to them by phone too, if you prefer, for a small extra fee. Even if the stocks are overseas, they are no more difficult to buy.  Though you can use any broker you wish that trade on the major stock markets like NYSE and NasDaq.

No, we don't recommend you buy anything unless you feel comfortable that the investment suits your risk profile. We simply present stocks that Lance Spicer considers worthwhile investing in. 

If you decide to buy stocks suggested, that is entirely up to you, but we should point out investing is stocks carry a degree of risk and you should always seek professional advice if you are inexperienced.

Many of our subscribers are new to the stock market and start with only small amounts. We do however recommend around $10,000 as a minimum to start to ensure you get some diversification.

Our broker’s fees are so low that placing a $1,000 in one stock is viable. Some subscribers have started off with under $10,000 and built up their investment from there, but most start with around $15,000 - $25,000. 

I often have subscribers sending emails about stocks that were once in the portfolio and even ones that were never in the portfolio, asking my opinion on whether to buy them or not. Well, unfortunately there are two reasons we can’t give an opinion.

The first is that I have my work cut out watching the stocks we have in the portfolio. Looking back at all the past stocks in the kind of depth that I do, is not something that I make a practice of unless it comes up on my radar again, which is when I’ll research it again and tell you about it if it makes the cut. So, when someone asks me about a stock that’s been sold for example, to give an opinion on it and have to go back and do some work on it, I really don’t have the time for the benefit of one subscriber.

Which then brings me to the second point: To give that opinion of whether to buy or not as a communication to one person is according to the ASIC “personal advice”. For me to give that advice I have to formally point out the risks involved, give you a formal statement of advice and get you to read it all and sign a disclaimer – Do you think I’m joking? I’m not.

Australia has turned into a nanny state where personal responsibility has been replaced with government intervention, regulation and interference. What financial advisers and fund managers have to go through each year from a regulatory point of view and the paperwork involved is a nightmare.

So, I apologise if we sometimes sound officious in our emails – we have to, it’s “nanny state” law. 

We invest for the best profits - not geographically. That's why our portfolio usually out performs every other newsletter portfolio in the world.

We are not constrained by one market. Often, we have stocks from the USA, Australia, Canada, Netherlands, France, China, Hong Kong, Brazil and the UK.

This subscription will provide one Australian and one Global stock opportunity in each monthly edition.

 

I mean it has higher risk of the price dropping than say a “low” risk stock.

Investing is never 100% risk free, particularly when it comes to stocks. When I say a stock has medium to high risk, it means it could be more volatile than normal and you should take this into account when buying stocks. I wish I could give you iron clad guarantees that every single stock I select will go straight up, but I can’t.

One of the big investing mistakes people make is being impatient and the next big one is being undisciplined. Rushing in and spending all your money on stocks in a rush is a recipe for disaster.

I would recommend to all investors that you allocate your capital sensibly. For example, if you have $20k, I would allocate that across say 5 stocks, $40K across 10 and say $100k across 20. Now, for example if you then come across a stock you want to purchase, spend only that proportion on that purchase and hold on to the rest. You then wait for the next one to come along. In the case of TC, that may be as soon as next week.You can also cast an eye over any stocks still in buy up to range.

Build your portfolio slowly and in a disciplined way. The results of the last 10 stocks purchased in the portfolio, compared to the first 10 in the portfolio are much the same over the longer term, so there is no need to try and buy “the lot”.  I understand there’s always a feeling that you’ll miss the rally, but bull market rallies are measured in years, not weeks or months.

I’ll definitely be coming up with some great stocks for you in coming weeks and months so you’ll have plenty of opportunities coming your way, so please bear with me and try and be patient. There is of course my new fund that will be available on December 1 if you want somewhere to “park” some of your investment monies.

I often have subscribers sending emails about stocks that were once in the portfolio and even ones that were never in the portfolio, asking my opinion on whether to buy them or not. Well, unfortunately there are two reasons we can’t give an opinion.

The first is that I have my work cut out watching the stocks we have in the portfolio. Looking back at all the past stocks in the kind of depth that I do, is not something that I make a practice of unless it comes up on my radar again, which is when I’ll research it again and tell you about it if it makes the cut. So, when someone asks me about a stock that’s been sold for example, to give an opinion on it and have to go back and do some work on it, I really don’t have the time for the benefit of one subscriber.

Which then brings me to the second point: To give that opinion of whether to buy or not as a communication to one person is according to the ASIC “personal advice”. For me to give that advice I have to formally point out the risks involved, give you a formal statement of advice and get you to read it all and sign a disclaimer – Do you think I’m joking? I’m not.

Australia has turned into a nanny state where personal responsibility has been replaced with government intervention, regulation and interference. What financial advisers and fund managers have to go through each year from a regulatory point of view and the paperwork involved is a nightmare, not just with the ASIC, but also the ATO.

So, I apologise if we sometimes sound officious in our emails – we have to, it’s “nanny state” law. 

All our products are digital and when delivered, can't be returned and under Australian law we have no obligation to refund purchases where you have bought the product and changed your mind or made the wrong decision.

A High Beta stock is a stock that has a price movement that is greater than the movement in the market. For example, a Beta of 1 means the stock price of that particular stock will move up and down in line with the market. A Beta of 2 (High Beta) will move up and down at twice the market movement.

Technology stocks tend to be High Beta and therefore appear very volatile, but they also happen to be the stocks with the highest appreciation potential.

I mean it has higher risk of the price dropping than say a “low” risk stock.

Investing is never 100% risk free, particularly when it comes to stocks. When I say a stock has medium to high risk, it means it could be more volatile than normal and you should take this into account when buying stocks. I wish I could give you iron clad guarantees that every single stock I select will go straight up, but I can’t. Most of the stocks TC picks are successful, even if they do stop us out initially (like Lynas has in the past).

It's normal practice, apart from ASX shares where if you have a HIN you can register the shares in your own name - but the brokerage is usually more expensive with this option. 
We like Halifax because it is so heavily regulated and audited, hence it is completely transparent.
 

Chess gives you direct ownership of the stocks you have bought but only works for Australian stocks. For US stocks, even those brokers who use Chess in Australia use a custodian system to hold US stocks where the custodian holds the stocks on your behalf.

One of the most popular platforms to trade US and Global stocks, Interactive Brokers (IB) use a “custodian type system”. What I mean by a “custodian type system” is that a third party or a separate entity holds shares on your account, as distinct from the actual broker through their own trading account.

In the case of IB they do not encumber your shares against any of their trading activity so if they go broke, the separate “custodian entity” remains intact and not put at risk, which is heavily regulated.

Sure some brokers like MF Global have used client funds for their own trading operations (and made a mess of it) – you simply don’t use brokers who could be in a position to do this – IB does not. 

Also, broker’s dealers may use a proportion of holdings that are leveraged in the brokers own account in much the same way as a bank may register an ownership interest in your house until it’s paid off. They use your margined shares as collateral to borrow the money from the bank that they have lent you to buy shares on margin, so makes sense. If your holdings are unemcumbered (and not leveraged), then they are not at risk from any disaster that may befall the broker dealer.

It’s more likely that you will lose your money holding a bad company, rather than investing through a bad broker.

Also, on the matter of leverage, at this time of year (May-October) it’s wise to reduce leverage if you have any, as leverage is you encumbering your own stocks and could cost you dearly in any serious pullback.

While I personally have a Margin Account with Interactive Brokers through Halifax, I don’t allow it to ever run into a leveraged situation – I have it to allow options leverage and if there’s a chance to buy a lot of shares very cheaply (along the lines of February 2009).

You need to have a registered company to have a leveraged account with IB however. They don’t allow individuals of SMSF’s to have leverage.

However, my best advice is, make sure your broker uses a custodian of separate entity which is totally unemcumbered from other trading activities. However, the authorities are all over this issue so it’s unlikely we’ll see another MF Global scenario.

What’s more, regardless of whether a “custodian entity” hold shares on your account or whether you have a direct account through Chess for Australian shares, the company who you have shares in knows they are owned, so they are not going anywhere, you still own them either way.

It only becomes a problem if your broker dealer encumbers them in some way that risks increase, so avoid margin and avoid brokers who don’t clearly state that the shares they hold on investor’s behalf are held by a non-trading entity who has no interest in them. IB fits the bill and regulators ensure they stick to their stated policies.