Defensive Buying - Week Ending 6 January 2017

Monday, 9th January 2017 14:31 - 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!

In the last week I had another successful trial with a FTSE 100 listed defensive buy. I bought BT Group (BT.A) on the ex-dividend day (29 December 2016) because price usually drops on the open of ex-dividend days and also because buying pressure had already built up on daily money flow for a while. It is profitable and dividend paying. This was my first try with BT.A and it indeed rises smoothly when it’s time to go. I will remember for next time!

Bought: 100 shares BT.A (in 1 tranche)

Total cost of purchase: £373.01

Return after selling cost: £380.22

Return on investment: 1.93%

Incubation time: 7 days

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.