Share Dealing For Dummies

I know that the black and yellow covered books covering a wide range of subjects have made the expression xyz for dummies a common phrase but share trading for dummies is not the same as Excel for dummies or bicycle gear and brakes maintenance for dummies.

With most subjects you get 2nd, 3rd, 4th and many more chances to mess things up and it doesn't matter, if you buy the wrong shares and lose money then that money is gone, it may have been your one chance.

If you have a lot of spare cash or a good job giving you a lot of excess income then you can try again. If you don't then you may only have one chance at trading shares every couple of years, as you build up a stake that is meaningful.

Generally people who trade shares lose money and they lose for many reasons, but a big one is the belief that it is easy and is something that anyone can do, possibly because they or a friend got lucky once or twice.

Anyway the point is that if you are thinking that all you need is a few pointers and you are off then you are at a very great risk of losing your money.

This is the wrong question to ask as no web site can answer that, instead you need to work out how you are going to acquire the knowledge needed to decide that for yourself.

I have looked at Saga quite a lot pre COVID it was a disappointing recent float and at the price of 16p (July 2020) it appears to be a bargain as it would be quite reasonable to say that once tourism resumes.... it will be back to 60p or even 120p

The problem is that this is just a guess, some of the questions that I asked myself were

• Will people go cruising again? Looking at all the RNSs from the company the answer does appear to be yes.
  
  
• Does the company have enough money to repay all the requests for refunds for cancelled holidays? Again the answer seems to be yes as many customers are simply having their money reallocated to another holiday.
  
  
• Does the company have enough money to meet loan repayments, this is less clear as they have deferred some loan repayments on their cruise ships.
  
  
• The insurance division is doing well and surprising to me is the fact that their 3 year policies are liked so will they split into Saga Insurance and Saga Travel? If they did the shares in one might crash on issue.
  
  

If you just read headlines you would find that the loan repayments on the ships had been deferred and might think good, you probably wouldn't have noticed that no dividend payments can be made until these missed payments have been repaid. If you are an institutional investor this could be enough to cause or require you to sell, it is likely then the share price will be heavily influenced by the retail investors.

Aston Martin have a new major share holder group, a new SUV, the DBX and is part owned by Lawrence Stroll a billionaire who also owns a Formula 1 motor racing team.


The F1 team is going to be sponsored by Aston Martinin 2021, wow they must be doing well.

Now go back and look at the share issues and the debt levels and possibly wonder where Aston's priorities are? Especially when you realise that some of the share were issued at 35p a share.

This chart may look different to the ones that you see elsewhere as I don't change the historic prices when a share consolidation takes place.

You can argue either way on this but I take the view that if you don't know that a consolidation has taken place then you shouldn't be buying the shares. Part of the reason for my approach is that it seems that most consolidations are associated with share issues or share price collapses, failing companies that cost their share holders at the time dearly.