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Advise on taking a loan to purchase stocks
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Kenyan Oracle
#11 Posted : Monday, July 11, 2016 7:13:44 PM
Rank: Member

Joined: 5/31/2011
Posts: 262
Due to the greed you've just mentioned, that's why banks are posting superhuman profits. Why not invest the monthly 50k by accumulating the said shares slowly slowly. The stock market is not going anywhere. Shares will always climb and plummet. The 7yrs cycle. Better yet invest in a reputable SACCO for the said number of years and have better leverage.
You lose money chasing women, but you never lose women chasing money - NAS
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kaimbaga2012
#12 Posted : Monday, July 11, 2016 8:09:39 PM
Rank: New-farer

Joined: 10/25/2011
Posts: 67
Be disciplined and invest that 50K religiously in the stock market.Don't take that loan. Build your portfolio slowly but surely. After five six years, the time it would have taken you to repay the loan, evaluate your portfolio and am sure you'll be happy. When Commitments increase you may not be able to make those kind of savings.
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sparkly
#13 Posted : Monday, July 11, 2016 8:21:44 PM
Rank: Elder

Joined: 9/23/2009
Posts: 8,083
Location: Enk are Nyirobi
Take the loan, buy stocks. Its a bear market and stocks are bound to recover in the next 2-3 years. Do not listen to the naysayers. If you buy stocks worth 3m and they rise by 50%, you will make a profit of 1.5m. less the 500k interest and you will have a clean 1m in your pocket.

The key is how choose your stocks to minimise loss (Not to maximise profits):
Pick stocks with low PE (Less than 8), history of dividends (Dividend in last 5 years), high dividend yield (at least 5%). DO NOT buy more than 3 shares! You can't watch over too many eggs.

Then sit back and enjoy the fruits of leverage.
Life is short. Live passionately.
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mufasa
#14 Posted : Monday, July 11, 2016 8:24:00 PM
Rank: Member

Joined: 4/15/2008
Posts: 238
I think you can hack it. But just note that from now on you're going to be having two jobs.
The suggested counters are good but to break-even you will need to be VERY good at short term trading.
Once the risk has been lowered you can now engage in mid term and long terms. The first two years will require a lot of dedication in research and implementation.
Do it today! Tomorrow is promise to no-one.
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ulekijana
#15 Posted : Monday, July 11, 2016 8:26:32 PM
Rank: Hello

Joined: 6/21/2016
Posts: 6
Location: Nairobi
Kenyan Oracle wrote:
Due to the greed you've just mentioned, that's why banks are posting superhuman profits. Why not invest the monthly 50k by accumulating the said shares slowly slowly. The stock market is not going anywhere. Shares will always climb and plummet. The 7yrs cycle. Better yet invest in a reputable SACCO for the said number of years and have better leverage.



Thanks for the advise but I am usually against saccos since I find them to be more expensive that banks. I may be wrong but here is my reasoning.

They basically tell you save x amount and then they give you a loan of upto 3times you savings. Which just means that they give you 2/3 of what you want since 1/3 is your money and apply the interest of 12% on 3/3 of the cash.
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VituVingiSana
#16 Posted : Monday, July 11, 2016 8:55:46 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,349
Location: Nairobi
ulekijana wrote:
Kenyan Oracle wrote:
Due to the greed you've just mentioned, that's why banks are posting superhuman profits. Why not invest the monthly 50k by accumulating the said shares slowly slowly. The stock market is not going anywhere. Shares will always climb and plummet. The 7yrs cycle. Better yet invest in a reputable SACCO for the said number of years and have better leverage.


Thanks for the advise but I am usually against saccos since I find them to be more expensive that banks. I may be wrong but here is my reasoning.

They basically tell you save x amount and then they give you a loan of upto 3times you savings. Which just means that they give you 2/3 of what you want since 1/3 is your money and apply the interest of 12% on 3/3 of the cash.

Smart chap. That's a wrinkle many miss! BTW, is the loan simple interest or compounding? Is there a 'dividend' on the 1/3?
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Swenani
#17 Posted : Monday, July 11, 2016 9:07:13 PM
Rank: User

Joined: 8/15/2013
Posts: 13,237
Location: Vacuum
VituVingiSana wrote:
ulekijana wrote:
Kenyan Oracle wrote:
Due to the greed you've just mentioned, that's why banks are posting superhuman profits. Why not invest the monthly 50k by accumulating the said shares slowly slowly. The stock market is not going anywhere. Shares will always climb and plummet. The 7yrs cycle. Better yet invest in a reputable SACCO for the said number of years and have better leverage.


Thanks for the advise but I am usually against saccos since I find them to be more expensive that banks. I may be wrong but here is my reasoning.

They basically tell you save x amount and then they give you a loan of upto 3times you savings. Which just means that they give you 2/3 of what you want since 1/3 is your money and apply the interest of 12% on 3/3 of the cash.

Smart chap. That's a wrinkle many miss! BTW, is the loan simple interest or compounding? Is there a 'dividend' on the 1/3?


Discussed here and concluded that Bank loans are cheaper than sacco loans
If Obiero did it, Who Am I?
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Kenyan Oracle
#18 Posted : Monday, July 11, 2016 9:35:21 PM
Rank: Member

Joined: 5/31/2011
Posts: 262
ulekijana wrote:
Kenyan Oracle wrote:
Due to the greed you've just mentioned, that's why banks are posting superhuman profits. Why not invest the monthly 50k by accumulating the said shares slowly slowly. The stock market is not going anywhere. Shares will always climb and plummet. The 7yrs cycle. Better yet invest in a reputable SACCO for the said number of years and have better leverage.



Thanks for the advise but I am usually against saccos since I find them to be more expensive that banks. I may be wrong but here is my reasoning.

They basically tell you save x amount and then they give you a loan of upto 3times you savings. Which just means that they give you 2/3 of what you want since 1/3 is your money and apply the interest of 12% on 3/3 of the cash.



Delayed gratification is the key word here. Not wanting to get the shares now now. About the sacco suggestions, was putting into consideration that apart from loans, most nowadays are investing in real estate and the dividends ain't that bad. My 2 cent
You lose money chasing women, but you never lose women chasing money - NAS
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ulekijana
#19 Posted : Monday, July 11, 2016 9:36:31 PM
Rank: Hello

Joined: 6/21/2016
Posts: 6
Location: Nairobi
PeterReborn wrote:
Dont take that loan to buy shares.You would rather accumulate the shares slowly.Te stock market may only recover from 2018.
Taking the loan though is a good idea rather than wasting the money with alcohol and women.Get the loan and buy a piece of land from verified property sellers like mhasibu and safaricom housing.With the 2m you can buy 4 or 5 piece of land at 400k each.


I am not going the land route since perhaps I am too chicken.

Why? I have no idea how not to get ripped off with all this fake titles going around. Then I find there is the lie in the now popular 1/8th an acre.

Even then, I really don't want to buy land that I do not have money to develop i.e. fence, pay land rates, I do not know anything about farming and surely that will not leave me with cash to even erect 2 apartments

My plan is to build the cash from the loan and buy a 1/8th when I get to 26 where I plan to settle when I get family at 30 I estimate. By then I will be disciplined enough as an investor to plan for a house wisely and hopefully not come back here with another question of a loan Laughing out loudly Laughing out loudly Laughing out loudly
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Swenani
#20 Posted : Monday, July 11, 2016 9:39:54 PM
Rank: User

Joined: 8/15/2013
Posts: 13,237
Location: Vacuum
ulekijana wrote:
PeterReborn wrote:
Dont take that loan to buy shares.You would rather accumulate the shares slowly.Te stock market may only recover from 2018.
Taking the loan though is a good idea rather than wasting the money with alcohol and women.Get the loan and buy a piece of land from verified property sellers like mhasibu and safaricom housing.With the 2m you can buy 4 or 5 piece of land at 400k each.


I am not going the land route since perhaps I am too chicken.

Why? I have no idea how not to get ripped off with all this fake titles going around. Then I find there is the lie in the now popular 1/8th an acre.

Even then, I really don't want to buy land that I do not have money to develop i.e. fence, pay land rates, I do not know anything about farming and surely that will not leave me with cash to even erect 2 apartments

My plan is to build the cash from the loan and buy a 1/8th when I get to 26 where I plan to settle when I get family at 30 I estimate. By then I will be disciplined enough as an investor to plan for a house wisely and hopefully not come back here with another question of a loan Laughing out loudly Laughing out loudly Laughing out loudly


seems you're young...You should also be visiting those fish parlours and eating fish from different cornersof this world....Trust me it grounds you!smile smile
If Obiero did it, Who Am I?
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