Even if you’re a new subscriber to the Switzer Super Report you would know by now that we’re big bulls. In the last few months of last year, after a horror month in September, one of our strongest messages was to buy on dips.
Peter said a number of times that if you believed the ASX/S&P 200 was going to come back then an exchange traded fund over the index – for example the SPDR S&P/ASX 200 Fund – was a good way to play it.
We’re going to see a bit of consolidation over the next few days – 10 straight days of gains following an interest rate cut would probably make any trader nervous – but if you had bought into the index last October when it was around the 5150 mark, you would be up over 10% today.
And if you’d bought Charlie’s favourite Telstra at $5.29 on October 10 last year, you would have paper profits of nearly 25% and we explained how well you would have done with CBA in a recent Short n Sweet.
If you’d bought NAB on 10 October at $31.92 you would be around 13% ahead and if you’d jumped into healthcare stocks Ramsay and Resmed on the same day – when they were trading at $48.49 and $5.52 – you would be around 25% and 46% ahead.
National Australia Bank (NAB)
Source: Yahoo!7 Finance, 5 February 2015
Ramsay (RHC)
Source: Yahoo!7 Finance, 5 February 2015
Resmed (RMD)
Source: Yahoo!7 Finance, 5 February 2015
That is why we say buy good companies on dips.
Yesterday I asked both Peter and Paul whether they were considering profit taking in any of their banks and their unanimous answer was ‘no way’.
They might be shuffling their positions – selling a little bit of CBA for a little bit of NAB for example – but nothing serious. These dividend payers are very hard to get rid of and for good reason, they will continue to provide the dividends that SMSF investors want and need.
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