How did the "lessons in buying shares" work out?

Investing is something that takes time and patience. As I mentioned in my "lessons" posts it helps to look at what the established Fund Managers buy and to then evaluate the shares on a set of Fundamental criteria. If I look at my share "BUY" recommendations the following happened since the posts:

• March 4th:     Capitec went from R183 to R226. This is a 23% increase
• Feb 14th:       Standard Bank went from R115 to R139. This is a 21% increase

So both these buy recommendations worked very well and in a very short period of time. This is not the norm and we could easily see them drop back but that is not the point. The POINT is that these are solid companies that were offering VALUE at the point of evaluation.

Would I buy them at current levels? No, I would wait for them to drop back. There are probably other shares that offer BETTER value at the current moment.

Would I SELL them and take profit? No, this is an investment and these companies are still as good as they were when we bought them, they are just more expensive for now.

Let's look at the company I mentioned as my least favorite in my Feb14th post:

• Naspers went from R1138 to R1033. That is a 9% drop.

But Naspers did go up to close to R1300 before it came down! It is not a bad company, just very expensive.

In one of my recent posts I also wrote about my feelings towards an Index tracker like SATRIX DIVI. I mentioned that I prefer to select the companies I invest in based on some Fundamental evaluation and not to be stuck in a company just because it has some other characteristic i.e. size or historic dividend.

Out of all the SATRIX funds the one with some fundamental evaluation criteria is SATRIX RAFI and I would rather be in it than the others. This does not mean that I believe the whole SATRIX range offer bad value, I only prefer to be more selective in the companies I invest in. We can see DIVI bounce nicely from the under performance over the last 2 years but the risk adjusted return over time pushes me to an actively managed investment.