Monday, 5th June 2017 09:59 - by Moosh
The number of shares in a defensive buy is dictated primarily by the asking price and the buy/sell commission that you pay – for simplification I will assume that the buy and sell commissions are the same value and will provide a maximum number of shares to buy for a single commission of £5.25, £7.50, £10.00, and £12.00.
If your commission is not shown here, then round up to the nearest commission level and use that as a potential maximum number of shares to buy, assuming you are happy with the fundamentals at the latest time and price given. I will be adding more companies to the Defensive Buy list when they are ready to appear on it and NOT before!
Here is a first defensive buy example in Westminster Group (WSG):
Bought: 989 shares WSG (3 tranches)
Total cost of purchase: £123.90
Return after selling cost: £143.10
Return on investment: 15.4%
Incubation time: 46 days
Total profit from defensive buys (rounded down to nearest pound):
£8 (GSK) +£7 (BT.A) +£50 (ARS) +£4 (OMI) +£81 (ARS) +£20 (OXP) +£6 (ARS) +£118 (PLUS) +£7(DLG) +£14 (MTR) +£24 (7DIG) +£30 (MTR) +£21 (CPI) +£15 (MTR) +£58 (PLUS) +£11 (PLUS) +£5 (CPI) +£18 (MTR) +£56 (EME) +£73 (EME) +£158 (EME) +£74 (EME) +£19 (EME) +£4 (UPL) +£9 (EME) +£19 (WSG) = £909
The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.