Ask Colin

Would you publish your watch list?

An edited version of the detailed question was:

One thing I find difficult is finding a stock to purchase, (confidence is the key or lack of it) There seem to be so many that fit the requirements (even though most seem over valued, so It is difficult to find some other fool to buy them when I pay too much). I am waiting for that fool on a few of my old stocks, I should have sold a long time ago.

My reason for this email is because, I would think you would have a list of the stocks you are keeping an eye on at most stages. Would you be able to show those stocks on your web site? I think maybe then especially if I was looking at the same stocks, it would give me a bit of confidence that I am looking at things correctly. (It is a big move having the courage to bet on my own work). One stock you owed previously I am looking at is picking up again. Is this still on your watch list?

After reading your book and then lending it to my son in-law and somehow it has gone missing, I ... purchased it a long time before I signed onto your web site. I went and invested in shares recommended by someone else and it turned out poorly.

I started again when I signed up as a member of your website. Since then my portfolio has pulled back 50% of my losses if I sold today. So I thank you for your help, I just wish I could spend a lot of time in your classroom. Of course you haven't got one.

I am not a licenced investment adviser and do not seek to be one because my defined aim is to teach people to develop their own investment plan and to make their own investment decisions. This is important because I will not be around forever, so sooner or later all my members will be on their own.

As you will be aware, the law says that in order to give investment advice I need a licence and ASIC’s rule is that I need  to know the client i.e. his or her entire investment plan.

You will also be aware from my website that the definition of advice in the Act is: ... a recommendation, a statement of opinion, or a report of either of those things, which is intended to influence, or which could be reasonably regarded as being intended to influence, a person in making a decision in relation to a particular financial product, a class of products or an interest in such products

I have sought legal advice on this and was advised that publishing a watch list would very clearly be expressing the view that the stock is worth watching. Hence it would be advice. So, legally, I cannot go there.

However, everything I do  its aimed at helping you create your own watch list and to evaluate the stock on it:

  1. My book Building Wealth in the Stock Market explains my investment plan. It is a model from which to develop your plan with absolutely has  to be different because we are not alike in so many ways.

  2. The book explains my market scans. For members without scanning software, I publish my scans and other scans that may fit other investment plans every week on the Weekly Market Scans page.

  3. On the Market Scan Examples page  I take you through a more up-to-date example of scans than were in my book and show how you can winnow them to a watch list. In other words, I teach how to do it, not provide a watch list because your watch list will and absolutely should be different to mine.

  4. On the Stock Investment Journals page I provide many examples of how to analyse a stock, using my own journals as up-to-date examples. This teaching by example is a very powerful technique. The journals stress not just the selection of the stock, but the more important aspect of managing the investment i.e. manage risk.

  5. The focus of my investment analysis is risk management, which is your expressed concern. It is central to the plan in my book and I have bene talking about it a lot in recent presentations around the country –slides are on the Presentations page.

So, everything is there for you to learn the craft of investing. Start with a re-read of my book and then use the resources on my website to build your investment portfolio and manage it.