How comfortable are you with your choice of ASX shares and their performance? There is one popular test of a company's prospects that is considered very reliable. It is known as 'skin in the game'.

Ask whether the directors and other senior managers of your chosen company have invested in its future and actually own shares in the entity they are managing.

The answer can give private investors a feeling of confidence and comfort in the share they have selected – but when it comes to share performance, is the benefit of having 'skin in the game' just a myth, or magic?

Managers who buy shares are motivated, but…

It is certainly true that most managers who take up shares in their own company have a focus on the wellbeing of their shareholders. And while this objective does occupy a prominent place in their minds, it is not their sole motivator. 

Other issues, like achieving high performance from your employees, nurturing and increasing customer numbers and lifting your brand's standing in the marketplace contribute equally to a stronger share price.

It is the combination of these and more actions that help strong managers achieve successes for their investors. 

Influential shareholders can have their own agendas

It is tempting to believe that the founder of a company or a dominant shareholder would share the motives of a private shareholder, but this is not necessarily always true.

A major shareholder can sometimes have their own agendas around company strategy, and these are not necessarily in line with the individual shareholder, who is simply looking for improved performance.

One classic example is when a corporation's founder decides to list 2 different types of share – voting and non-voting. This is an approach that allows the founder to pursue their own interests, which may be in conflict with shareholder interests.

From observation, major shareholders who choose to allow professional managers to make key strategic decisions seem to achieve significantly better outcomes for their investors.

Is the idea of 'skin in the game' a myth? 

In the book Master CEOs: Insights from Australia's Leading CEOs by Matthew Kidman and Alex Feher, of the 13 CEOs interviewed, just 1 listed shareholders as their priority.

Each of these CEOs had been running their company for more than 10 years. Each company had comfortably outstripped share market performance. Some of the CEOs were paid well, some owned a decent number of shares while others owned just a few.

This evidence would seem to suggest that the jury is still out one the issue of 'skin in the game'. It certainly is a positive, but it's definitely not the magic answer that every ASX investor is looking for.

The post 'Skin in the game' test: myth or magic for ASX investors? appeared first on The Motley Fool Australia.

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• 3 Betashares ETFs that I'd buy with $2,500
• Why this small ASX share could generate big returns!
• How many NAB shares do I need to buy for $10,000 of passive income?
• 2 ASX 200 shares I'd want my kids to own

Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It's an argument that has been raging, debated and written about for years! Are private investors as effective and successful as the professional money managers who make their living handing out expert advice?

We're all aware of the big names – Warren Buffett, John Templeton, David Dreman to name just a few – and their outstanding share market successes. Then there are the fund managers who are paid for their advice and purport to know things that we don't.

Are they really so much better than us? Why can't we mere mortals be similarly successful? Do they have secrets we should learn?

It's really a matter of time

Perhaps the biggest difference between the amateur investor and the pro is the amount of time we ordinary people can devote to analysing the market and the mass of information that is available to us.

If you can find the time to 'do your homework' on the market, there is no reason why the man on the street can't match the performance of the expert fund managers – especially when you deduct their charges from the profits they earn for you.

Over time, only the most successful professionals have achieved returns over and above the share market, but these have only advantaged a mere 1 or 2 percentage points. Not a great advantage

Size doesn't matter to you

You are not going to be penalised because of the size of your share portfolio. But because the size of their funds under management determines the fees professional money managers can charge their clients, they operate with another motive that doesn't necessarily relate to your best interests.

They are also bound by red tape that requires them to match their portfolio to the index they are following. This can affect the fund manager's performance by restricting the deals they can do and forcing them to own particular shares to match the index.

A manager will be viewed as taking on excessive risk if he strays too far from the index.

In short, they often can't operate with the freedom you enjoy.

The bear market – bad news for professionals

As funds fill the coffers of the successful money managers in a Bull market, most funds are required to invest in shares that have become more and more expensive. This at exactly the time that private investors would consider taking a profit and selling the same shares.

Should the market turn to take on more bearish characteristics, share prices fall and many of the better stocks suddenly look like bargains. The fund managers are then compelled to sell, just when the private investor would be more likely to buy.

These market changes are bad news for the pros but can be great for the amateur investor.

So who is better?

Clearly, there is a place for both the private investor and the professional in the share market. Each has its advantages and each has its limits. I personally lean a little towards the private punter. What do you think?

The post The great ASX investing debate: Who's better – you or the fund managers? appeared first on The Motley Fool Australia.

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• New to ASX ETFs? These 4 products could be a good start
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• 2 ASX 200 shares I'd want my kids to own

Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

We are now told there is a great risk of a recession. The bushfires that devastated so much of Australia, severely impairing our tourist industry, are conspiring with the globe's new enemy – coronavirus – applying the handbrake to our economy.

If we suffer 2 consecutive quarters of what is strangely labelled 'negative growth', we are officially in recession. What will you do to survive if this happens?

Here are 6 steps that serious share investors can take to survive.

1. Diversify. If you invest a lot of your available funds in 1 or 2 shares, most of your risk is focused on the performance of those companies. When you diversify your portfolio to include a range of investments – even international shares – you are spreading your exposure and are less vulnerable.
2. Set clear and measurable objectives. What motivates your investment? Is it to build wealth quickly or maybe to plan for your eventual retirement? When you are clear on the answers, you can set a meaningful strategy with the solid shares you choose to be a part of your plan, rather than assembling a mishmash with no overarching purpose driving them.
3. Re-assess your level of risk. You may have normally favoured a balanced portfolio of blue-chip shares and higher risk speculative stocks. But when times are tougher, it is often a good rule have a smaller share of risky assets in your portfolio. The 'safer' stronger shares are less likely to be severely impacted in a recession.
4. Consider moving to a managed fund. As well as using your own judgement for selecting shares, why not move a part of your investment to one of the better performing managed funds? But choose carefully – good past results are no guarantee of continued successes.
5. Check the fees being charged. With no certainty surrounding your future returns, a managed fund may provide a buffer against the recession, but fees can also limit the earnings you'll enjoy through this investment. To keep costs down, consider investing in indexed funds whenever possible.
6. Think about making a move. If you're employed, how secure will your position be in recessionary times? Is your company badly impacted by this slowdown? Are the fellow employees you admire suddenly moving on? Most importantly, what did your manager tell you at your last performance review? It could be time for you to look for a better, more recession-proof job.

Follow these tips and seek any and every extra piece of advice on offer. Then fasten your seatbelt and ride out the turbulence! If a recession occurs, it should hopefully be short-lived and you'll soon be back on familiar ground.

The post 6 steps to help ASX investors survive a recession appeared first on The Motley Fool Australia.

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• New to ASX ETFs? These 4 products could be a good start
• 3 Betashares ETFs that I'd buy with $2,500
• Why this small ASX share could generate big returns!
• How many NAB shares do I need to buy for $10,000 of passive income?
• 2 ASX 200 shares I'd want my kids to own

Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Could it be that one of the best ASX investment choices of them all is right here in front of you?

The ASX first listed back in 1998, listing with a share price of $4. Many brokers couldn't believe their luck when the ASX chose to list itself. The good news kept coming when it then merged with the Sydney Futures Exchange to form the Australian Securities Exchange, ASX Ltd (ASX: ASX).

Brokers thought they had the best share of all. They were impressed with its growth rate and flawless balance sheet. It was on its own with no competition – the ultimate combination of two monopolies – and by 2007, with the economy sailing downwind, ASX shares were trading near $60.

The GFC and a history of headwinds

The ASX share price naturally reflects the health of the total share market. When the Global Financial Crisis rocked the financial world in 2008, the ASX reacted, dropping in price to just over a third of its former value at $24.

But just as the Australian economy overcame the set back of the GFC, ASX shares recovered – only to face their next big hurdle, this time from the Australian Federal Government. Through the Australian Securities and Investments Commission (ASIC), the government had chosen to introduce competition to the ASX monopoly and issued licences to other entities to set up alternative securities exchanges.

Once again, the investor market got the jitters and the ASX share price fell, reflecting the potential threat this new legislation held. It was not to be, however and was very short lived.

Singapore's takeover bid sparks political action

When the Singapore Stock Exchange (SGX) proposed a takeover of the ASX in 2010, it valued the entity at $8.3 billion. The SGX was quite bullish about its offer and touted the fact that this union would create South East Asia's fourth-largest stock exchange.  

After a great deal of publicity, the bid was ultimately not accepted thanks to federal Treasurer Wayne Swan who said in a statement at the time that it was 'no brainer' to reject the merger.

A decade later, the ASX is looking good

Today, ASX shares are trading at a price of $74 at the time of writing, down around 13% with the rest of the market amidst the COVID-19 panic. Until recently, it was priced at over $85 – not a bad gain, considering ASX shares first listed at just $4! Last year, ASX shares paid a franked dividend of $3.58 per share.

For investors, having ASX shares is like owning your own playground. What brokers initially called the 'best share ever' is still offering excellent gains and dividend returns. And it's right under your nose!

The post Could the ASX be the best share of them all? appeared first on The Motley Fool Australia.

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Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It is amazing how so many industries choose to hide behind their own jargon and acronyms. In IT, audio, and even the car industry – they all use terminology that makes them sound like experts in their own field but often fails to communicate with their customers.

Are we really expected to know what MBS, a signal to noise ratio or a VTEC system means?

(When I worked in with a large insurance company, I started a movement called "Axe the Acronym". You can imagine how well that went!)

The share market can be just as mystifying. So here, I will try to simplify and explain what one important term really means and more importantly, its significance to you as an investor.

So what is a P/E ratio?

The ubiquitous Price to Earnings Ratio – everyone talks about it – but how many people really understand its significance?

In the analysis of a company's financial state of health, its P/E ratio could be compared to the health of its blood system. The ratio can be arrived at by dividing a company's market capitalisation (that is, its share price multiplied by the number of shares issued) by its annual net profit.

In other words, if each share is $10 and there are 100 million shares issued, its market capitalisation is $1 billion. And, if the company's annual net profit is $50 million, its price to earnings ratio would be 20. If it showed a net profit of $200 million, its P/E ratio would be 5. Getting the picture?

Actual average ratio for the Australian stock market can vary between a low figure of 8 after a market crash up to around 25 in boom times.

Some revealing examples

 As I said, a company's P/E ratio is like the results of a medical. For example, National Australia Bank Ltd. (ASX: NAB) currently has a P/E ratio of around 13, while the Commonwealth Bank of Australia (ASX: CBA) has a higher P/E ratio of roughly 16. While these two big ASX banks are recording different results, the numbers place them both in the normal range.

In contrast, a share like Medical Developments International Ltd (ASX: MVP) has a huge P/E Ratio of around 520, yet its share price has more than doubled in the past 12 months! This illustrates that the P/E ratio is only one of the many factors you should study to determine your investment choices.

As always, it pays to be thorough.

Beware of smoke and mirrors

Of course, the honesty of some companies' profit declarations could be an issue and can grossly distort their P/E ratio. 'Clever' accounting can be employed to falsely inflate net profits. Close scrutiny of the company's balance sheet should reveal any chicanery. A key factor is whether the company's cash flow supports its profitability claims.

Once you've established an accurate P/E ratio, it can be a very valuable tool. The ratio is a gauge of market sentiment including general views of the company's quality of management, prospective profitability and other measures that contribute to an overall picture of its worth.

You can even study charts that plot a company's historic P/E performance and any sudden shifts should be viewed with suspicion.

A company's P/E ratio really does matter if you are looking for shares that have broad support with a set of hard financial facts to underpin their popularity amongst the investors.

The post What do P/E ratios really mean? And do they matter? appeared first on The Motley Fool Australia.

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Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Medical Developments International Limited. The Motley Fool Australia owns shares of National Australia Bank Limited. The Motley Fool Australia has recommended Medical Developments International Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It's every investor's wish – choosing that low-price share that is about to set the market alight with its astounding growth. Within months, you'll be sipping champagne on the deck of your own private yacht in the azure Mediterranean!

While we can all share in this delightful fantasy, the reality is that this share growth question has been asked by virtually every share market investor forever. While there is no 'silver bullet' answer, there are some sobering tips we can follow, with a little self-discipline.

Start by looking for real ideas

There is no reason to believe that a product, service or concept that has been around for years is going to suddenly provide you with the huge growth you're looking for. When Apple launched its Mac and iPhone, they were brand new concepts. They have since gone on to record exponential growth and made Apple one of the world's leading international companies!

Closer to home, the same was true of the Cochlear Limited (ASX: COH) implant to overcome hearing problems and the many innovative products of Australia's own CSL Limited (ASX: CSL) when it launched.

So, what is new today? Which companies have presented to the ASX with uniquely innovative ideas? Find those companies and you could be onto the answer. 

Ask questions. You'll be surprised what you can learn

Information is vital to every investor. When you ask questions instead of making statements, you'll often be surprised and delighted with what you hear. Most people are only too happy to tell you all about their jobs and their company. You can learn a lot.

The short of what I'm suggesting here is that you can turn your curiosity into a valuable resource and learn a lot simply by asking questions.

Should you study the charts? 

This discipline underpins the choice of shares for many fund managers but may only rarely reveal shares that fit the categories described above. Charts analyse the history of a share's price rather than predicting what is likely to occur in the future.

So, the short answer is 'no'. This is not to say that information can't be gleaned from charts, but they tend not to be predictive tools.

It is a very good question!

Every investor dreams of finding that magic share that will generate stratospheric growth and create brilliant returns. We've discussed some tactics to help you find these opportunities but also pointed out just how difficult it can be.

So good luck in your search. Try some of the strategies discussed in this article and put them into practice. Who knows, you could be sipping champagne on your own private yacht any day now.

The post How do you choose shares that are going up? Good question! appeared first on The Motley Fool Australia.

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Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Apple. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. and CSL Ltd. The Motley Fool Australia has recommended Apple and Cochlear Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

What differentiates professional share market investors from rank and file amateurs? One question the 'pros' will almost invariably ask is "Who's the boss?" – in other words, how good is this company's management team?

So now we have the key question, how do we work out the answer?

Assessing the human element 

While many of us spend a lot of time analysing corporate performance, there is also a 'flesh and blood' evaluation that can be even more significant in formulating your views of a share's future. Of course, there are the annual general meetings to attend where you will hear from senior management on their plans for the future, but you can do more.

Management personnel deal with a lot of people – employees, clients, industry peers, industry associations and so on. Most of these people are readily accessible, so talk to them and ask their views of the management people you want to assess.

As the picture of their performance and qualities start to materialise, you will begin to see a more balanced rating of management expertise.

If it's good enough for Warren Buffett…

Arguably the world's most celebrated investor, Warren Buffett believes seriously in evaluating the quality of senior management as a key factor when selecting stocks.

Buffett has actually gone so far as to recruit outstanding management talent to be employed by companies in which he holds a major shareholding. His skill in recognising exceptional talent has been a core factor in his remarkably successful career.

Whether it is direct contact with key management figures, building a profile through the people they deal with in business or in-depth analysis of their present and past performances, your quality rating of senior management is one question you should be asking.

Over-confidence can be underwhelming

One trait among some senior managers that you should be wary of is the arrogance that stems from over-confidence. It is a natural human defence mechanism that seeks to defray further investigation by blustering through any debate.

You would have thought that the findings of the recent Royal Commission into the financial services industry would have put paid to this, but it still exists!

There are also other personality problems to look out for (and be quick to run a mile from) among senior management. The use of 'corporate speak' is often used to avoid clarity. Lots of lofty-sounding jargon can be used to disguise very little substance.

Then there's longevity. How long have the key decision makers within the company been in their positions? Too many changes in too short a time frame could be a result of systemic problems within the management team.

The one question every investor should ask

Choosing the right shares to invest in is a function of diligent financial analysis, studying market conditions and – most importantly – assessing and evaluating the quality of senior management's performance.

Some of the world's most successful investors place more importance on the last criterion than any other. So make sure when you ask 'who's the boss', you have a very good idea of the answer.

The post Who's the boss? It's the one question every investor should ask appeared first on The Motley Fool Australia.

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Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

I was fortunate enough to be born and raised at Bondi Beach. One of the many benefits this provided to me – apart from the stunning beach itself – was early, accurate lessons in water safety and surf craft.

We were taught as youngsters how to recognise a 'rip' and what to do to escape its force.

"Don't waste your energy trying to swim against it, you'll be taken out to sea if you do!" said the friendly lifeguard. The threat of such a disaster was enough to make us all pay serious attention to his advice!

The ebb and flow of share market 'tides'

This word from the wise lifeguard applies equally to the share market. It has a tidal energy and while fighting it won't necessarily be fatal, it can prove very costly.

Consider the technology boom we have been experiencing for decades – best measured by the US NASDAQ index. This s a classic example of an unstoppable tidal force with its progress over the past 10 years recording a massive 450% gain.

Fighting this force can be dangerous

Some 'clever' investors have predicted a major correction in the growth of technology shares. While there have been occasional minor slumps – the Nasdaq did drop more than 1% in late 2018 – this proved to be a rare blip in the tech sector's unstoppable tsunami of growth.

Other share market tidal trends should also be respected by serious investors. There is the irrepressible growth in online retail sales versus the ebbing tide of steady decline in some more traditional areas of retail.

The recent spate of store closures and entries into voluntary administration are testimony to the tough times many retailers have been enduring. Once household names like Just Jeans, Starbucks, Harris Scarfe, Bardot and more are either shrinking or disappearing altogether.

Against this, shares like Kogan.com Ltd (ASX: KGN) and JB Hi-Fi Limited (ASX: JBH) and Webjet Limited (ASX: WEB) are riding the online wave with considerable panache.

The nimble amongst the traditional retailers like Harvey Norman Holdings Limited (ASX: HVN), Coles Group Ltd (ASX: COL) and Officeworks – a division of Wesfarmers Ltd (ASX: WES) have chosen to go with the flow and have dramatically strengthened their own online representation.

That's swimming with the tide – not against it.

A major lesson learnt

Once, there was a very well-known and successful investor called Brian Price (now Executive Chairman of the Finance and Energy Exchange). Brian was convinced that the tidal technology surge that powered the NASDAQ and ASX would one day face a correction.

His strategy was to short sell the NASDAQ, believing he would make a financial killing when it fell. As the months and then years rolled by without an interruption to its growth, he kept on increasing his short position

When the technology share market finally did drop and lost 70% of its value, Brian had been required by his lenders to exit his position and he lost millions. Fortunately, he had made other more favourable investments which compensated him for this mistake.

Back at the beach

It always surprises me just how much simple wisdom can be learnt as a child. I guess a young mind is far less crowded than ours are today and can retain these lessons.

But it is certain that elements of the share market do move with the relentless force of tides. Trying to swim against them can be very costly indeed.

The post Beware of the perils of swimming against the tide appeared first on The Motley Fool Australia.

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• 2 ASX 200 shares I'd want my kids to own

Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Wesfarmers Limited. The Motley Fool Australia has recommended Kogan.com ltd and Webjet Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Way back in 1969, there was a company called Poseidon No Liability – not to be confused with its namesake Poseidon Nickel Limited (ASX: POS), which is the renamed Niagara Mining Limited and currently trades on the ASX.

Back to Poseidon the former. The company was an obscure miner that announced a major discovery of nickel in Western Australia. This commodity was in very short supply and high demand with the Vietnam War raging.

At the time, nickel was selling on the London market for £7,000 a ton (or approximately AU$25,000 converted to today's value).

Some lucky investors had bought Poseidon shares for just 80 cents, but after the company announced its nickel discovery, the shares quickly rose in value and reached $12.30 – more than 15 times higher. But this was just the beginning.

Absolute fortunes were made, and lost

Without any further statements from Poseidon, the share market caught nickel fever. The Poseidon share price rose further and further and kept on rising until it ultimately reached a share price of $280 in February 1970.

Many clever investors made extraordinary profits – literally millions – by selling as the shares rose. Others bought in and held their investment, losing fortunes as the Poseidon share price crashed back to next to nothing.

So, what is the secret behind knowing when to sell? Is it all just guesswork? Or is there a science to it?

Knowing when to leave

It's first worth reminding ourselves that the economists define 'profit' as 'the reward for risk'. Every investment in the share market has an element of risk attached and there is no scientific or fool-proof answer to optimising profit.

However, realism is one answer. Vigilance offers another.

How much do you realistically believe would constitute a fair and reasonable profit on your investment? Set that figure as your goal and as your shareholding approaches that figure, sell.

It also pays to be aware on at least a daily basis of movements in the price of your shares. Your investment is not a set-and-forget proposition, it requires constant monitoring. When you are totally on top of market movements you can act swiftly to capitalise and gain. 

The one question every investor wants answered

As you've no doubt gathered, there is no solid answer to the question of knowing when to take profits with a sale. Maybe that's why we are all so enthralled with the share market – its ups and downs, its moods and tantrums.

The market seems to rise and fall on the dubious strength of a whispered rumour or the international significance of an impeachment vote. But that is exactly why we love it.

There will always be risks to be taken and profits to be made. Just knowing when to sell is the 64 dollar question.

The post How will you know when it's time to take your profit? appeared first on The Motley Fool Australia.

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• 2 ASX 200 shares I'd want my kids to own

Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

For new entrants starting out on their first foray into shares, the ASX listings must look more than a little confusing.

Perhaps a tip from an office colleague or an overheard conversation at the pub mentioning a certain 'hot' share sparked their interest – but when they try to convert these titbits of information into a financial reality by buying shares, they face the maze which we know as the ASX share register, or asx.com.au.

This site actually holds an absolute treasure trove of relevant information for the novice investor, it just takes a little time to learn how to navigate the website and retrieve the information you need. 

Opening the vault

There's no doubt that navigating the ASX share register can be confusing for newbies. But what first appears to be a maze can soon become much clearer with a few tips and a little more familiarity with the share market.

Tip one is to learn how to find your share's 3 letter code, or ticker code (which acts as its unique identifier on the share market).

Go onto the ASX website and you'll see an empty box marked 'Share Prices". Next to this box are the words "Find a code". Click on this.

Now, let's say you have an interest in supermarket giant Coles. Simply start typing Coles into the box. The ASX ticker code 'COL' should appear immediately. Go back to the 'Share Prices' box and enter the code this into the "Search again" box and you're away!

Want to learn more? It's all here!

How has the share you're interested in been performing over the past 6 months? Just click on "Chart" (third column from the right) and you'll see its price history for the last 6 months. Sticking with Coles shares, as an example, the chart will display the shares' high point. Has its price been falling or increasing? The graph will display all the detail.

What news has your share been delivering to investors? These announcements are demanded by the ASX when any information is considered necessary to shareholders. All recent releases are captured on the ASX site in the far right hand column titled "Announcements". Click on this tab and you'll be able to read all the recent releases published by the stock.

The more you can learn about each share, its performance and its prospects, the better informed you will be.

Packed with information

The ASX website is really worth exploring because it is literally full of information. You can check on your stock's performance for the day. At what price did it open? What was its high point and its low? And what volume of your chosen shares were traded today?

Once again, the information is all there.

You can also check other prices including bonds, hybrids and options, find out what dividends individual shares are paying and even get advice on upcoming share floats.

Familiarity breeds content

Like all unfamiliar technology, the ASX register can appear daunting at first sight, but the more you explore, the more familiar you will become with the huge volume and variety of information it stores.

So now, it's over to you. Put aside a half hour and start your own journey through the maze that is the ASX share register. You could be very pleasantly surprised with what you learn.

The post Demystifying the ASX share register appeared first on The Motley Fool Australia.

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Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There is a whole raft of share market analytical tools available to you plus a number of 'experts' willing to offer their skills in evaluating your investment options.

But each of these tend to take a cold, pragmatic and clinical approach.

They crunch numbers, compare past performances and economic conditions. It's hard to argue with these 'facts' – but as an investor, you are still a human being, complete with feelings, attitudes and emotions. There is an argument for reflecting these facts in your selection of shares to invest in.

Does it feel right? 

I'm not decrying the importance of sound share market analytics, but you also need to be personally comfortable with the choices you make.

Perhaps you are a person who is passionate about climate change and its impact on our world. Then investing in shares that involve mining of fossil fuels could present a real conflict of emotions for you.

While shares like BHP Group Limited (ASX: BHP) offer excellent financial stability and returns, their extensive involvement in the coal industry may not make you feel all that comfortable.

Alternatively, an investment in a renewable energy organisation like New Energy Solar Ltd (ASX: NEW) could prove to be both financially and emotionally rewarding as its products' acceptance and application grow. They could prove to be of real value in the not too distant future.

Maybe you are keen to see our population achieve better attitudes towards their diets, exercise and general health. Then you may lean towards stocks that encourage this outcome like Viva Leisure Ltd (ASX: VVA), which is expanding its regional fitness centre interests. You may also opt to steer away from other market success stories like Domino's Pizza Enterprises Ltd. (ASX: DMP).

As another example, while many of us enjoy the occasional alcoholic beverage, there are others among us who have a fundamental problem with the dependence a lot of Australians have on the 'demon drink'.

Some investors could therefore be more comfortable with an investment in the A2 Milk Company Ltd (ASX: A2M) than they would be with another Australian icon – Treasury Wine Estates Ltd (ASX: TWE).

Like choosing your partner

There are many non-emotional reasons to choose a share to buy and these must be considered seriously, just as there are in your choice of a partner.

Yet you could be living with the shares you choose tomorrow for many years to come. Feeling happy and content in their company can create an emotional bonus on top of the good financial returns you're looking for.

The post Choose your shares like you choose your partner – with your head and your heart appeared first on The Motley Fool Australia.

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Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Treasury Wine Estates Limited. The Motley Fool Australia has recommended Domino's Pizza Enterprises Limited and Viva Leisure Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The spate of recent closures in some major Australian retail chains has thrown a shadow over the entire category in the minds of many investors. Jeans West, Starbucks, Harris Scarfe, Bardot, EB Games and others have recently either dramatically reduced their retail outlets or chosen to go into voluntary receivership.

Even Big W, a division of Woolworths Group Ltd (ASX: WOW) has flagged the impending closure of 30 of its outlets across Australia.

Yet customers are still spending and while retail growth is only marginal, Australia hasn't seen a major downturn in sales. So, what has affected the fortunes of so many retailers?

There are many possible causes.

Reading the market

The retail market, like many others, is dynamic and ever-changing. Influences like online shopping, new entrants into established retail categories and evolving consumer preferences have all had an impact on the sector.

How well senior management is monitoring these fluid changes amongst its customer base can be critical to its business' futures. How astute is the management of the retailers you're considering investing in? It bears close investigation. 

More stores can mean less profit

Managing a retail chain can involve a delicate balancing act. For example, there is the jeopardy of the expansion strategy. It can seem logical that the more outlets you have, the greater the profitability you will enjoy.

But this thinking can be countered by the exposure to added physical, labour and other costs involved in the expansion. While revenue will increase with added outlets, the additional costs involved in setting up stores, freight, recruitment, local marketing, advertising and more can turn increased revenue into lower profits.

The times are changing

The growth of online communication has shifted the retail forum from the local high street to the global stage. Major names like Amazon and Alibaba can sell virtually anything to anyone, anywhere and back their offerings with remarkable customer service. But these megastores are just one end of the market.

Thousands of other online retailers are now competing for the customer dollar. Smart local retailers have adapted and added online to their retail offering.

While in other categories like clothing, the hands-on experience of personal shopping still presents real advantages to a great number of customers.

Retail is a complex and constantly evolving 'organism' that requires regular health checks to maintain its viability. It's worth checking how well your investment choice is performing in this climate.

Warning! Enter at your own risk

While the performance of the ASX retail sector is more visible to us than many other industries, its value as a share category is no more or less risky than any other. The secret for investors remains to do your homework, assess the threats and opportunities and make informed and educated choices.

Many Australian retailers continue to perform very well. JB Hi-Fi Limited (ASX: JBH), Coles Group Ltd (ASX: COL), Harvey Norman Holdings Limited (ASX: HVN) – the list of Australian retail share successes worth serious investor consideration is a long one.

The recent store closures could well be nothing more than the result of senior management's failure to read the changing market until it was too late.

The post Are ASX retail shares really risky? appeared first on The Motley Fool Australia.

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Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

With the S&P/ASX 200 Index (INDEXASX: XJO) hitting new highs, these days a lot of investors are feeling understandably chuffed. But it is worth reminding ourselves that the share market has a volatile history of producing highs and lows, booms and busts.

The really astute investor is not only aware of this but also has the ability to keep one eye focused on the signs of a potential share market turnaround. How do they do this? By studying history.

Everything old is new again

So say the lyrics of the 1970s hit song from the movie All that Jazz. These words describe the cyclical nature of so many parts of our lives.

Think about it – clothes fashions come and go, then come again. Music is the same. Just look at how many bands from 30 or 40 years ago are back touring again today! And then there's the prophetic application that the same words can have for today's share market investors.

The share market historically goes through periods of showing healthy gains or retracting into negative territory. It is either in a bull or a bear mode.

The key for clever investors is to be able to recognise just when a change is coming and a secret to this lies in the past.

It's just history repeating

The help of a share market historian would make a lot of sense, but unfortunately, they can be hard to find.

One such individual is Andrew McCauley – an analyst with more than a quarter of a century's experience. He has examined the Australian share market over the past 100 years and identified repeating conditions that coincide with major changes in performance.

As highlighted in the book Bulls, Bears and a Croupier: The Insider's Guide to Profiting from the Australian Stockmarket by Matthew Kidman, Andrew learnt that the share market has rarely ever suffered more than 7 consecutive quarterly declines. He was therefore confident for example, that the downturn of 2008 would end in early 2009.

His prediction proved right, as by early that year the market turned from bear to bull.

Another expert featured in Kidman's book is Atul Lele, who spent four years with Credit Suisse as an investment strategist. While not strictly a historian, he is a highly experienced student of the stock market.

Atul has made accurate assessments based on global liquidity and his own invention – the 'fear ratio', which balances investor over-confidence with their degree of fear. While his approach isn't purely scientific, it has produced very accurate predictions of major market growth and retractions.

Eyes in the back of your head

While times are looking good for investors right now, there will one day be a change that could have a real impact on our portfolios. Having the ability to recognise its approach could be of immense benefit to all of us.

Help is available – especially when you take the time to study the share market's history.

The post Want a better understanding of the share market? Study the past appeared first on The Motley Fool Australia.

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Motley Fool contributor Gregory Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Motley Fool articles are normally packed with stories about ASX shares that could show strong growth and offer excellent returns for investors, but this one's is a little different! No hot tips or clever investment strategies – but the outcome can still be very financially rewarding.

American country singer Kenny Rogers had a big hit way back in 1978 called 'The Gambler'. The song's chorus contained some sage advice for poker players that also applies just as much for share market investors.

We tend to think playing in the market requires constant daily vigilance, quick reflexes and – especially for day-traders – a rapid turnaround in their holdings. But 'The Gambler' hints at another type of profitable investment.

When you're on to a good thing… 

It can happen in so many ways. Perhaps your first job involved a share offer from your employer many years ago with a yearly top up of extra shares. Maybe a maiden aunt passed away and bequeathed a stock portfolio to you. Or perhaps you put a toe in the water with a share market investment as a callow youth.

You may have forgotten you once owned them. Or perhaps you have that bower-bird mentality that makes you want to hang on to what you've got.

No matter how it started, lots of people have made lots of money – not by actively trading –but by sticking to their investments.

Some "Set-and-Forget" case studies

Back in 1999, you could have bought stock in Commonwealth Serum Laboratories, now known as CSL Limited (ASX: CSL), for the princely sum of $3.70. At that price, you could also have been inclined to buy a significant number of shares – say 300.

Well, CSL shares are now going for more than $285 (at the time of writing). That would have seen your initial investment of $1,110 grow into the very tidy return of $85,500!

Maybe the banking sector attracted your attention back before the turn of the millennium. Back 28 years ago, when the Commonwealth Bank of Australia (ASX: CBA) floated, it made shares available to the public for $5.40.

Having lived through the recent Royal Commission and subsequent court proceedings, CBA's share price today exceeds $82 (at the tie of writing), making an initial holding of just 1,000 shares worth over $82,000 today.

What about the retailers I hear you ask? Well, you could have seen a gain of more than 50% in the past 5 years had you chosen to invest in JB Hi-Fi Ltd (ASX: JBH). A shorter term and a smaller gain than the previous examples, but still impressive with no daily vigilance, actions or anxiety involved.

"You've got to know when to fold 'em" 

That Kenny Rogers song 'The Gambler' goes on to say that it's equally important to keep your eyes on the prize and know exactly when your long-term investment is threatened, turns sour or loses its impetus. So be prepared to exit investments when these signs appear.

But the fact remains, great returns are achievable simply by choosing the right stocks in the first place and then sticking to your investments. Good (long-term) luck!

The post ASX investing tips: Why "you've got to know when to hold 'em" appeared first on The Motley Fool Australia.

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Motley Fool contributor Greg Butler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Talk to a group of investors and it quickly becomes apparent that there are many differing motivations, strategies and attitudes amongst them. A little honest introspection can lead you to a better understanding of your own objectives and the impact your personality has on your activities on the Aussie sharemarket.

Noted financial editors and fund managers have described the various personality types that exist amongst share market investors. Let's take a look at the personality types they have identified.

Big picture analysts

These are the serious students of trends in political and economic activity – both here and internationally. They gather data on international trade, political leadership and general sentiment, then drill down to apply this knowledge to the performance of major corporations.

They believe their understanding of the global picture helps them make more informed decisions about individual share options. This sounds like hard work, but their personalities require the reassurance of this research.

Schroders Chief Economist and Strategist Keith Wade says that geopolitical risk is regularly cited as the greatest risk for markets and investors. Recent incidents like the waxing and waning of US–China trade tariff talks and the ongoing uncertainty surrounding the UK's Brexit negotiations are two strong cases in point.

Twenty years ago, this approach could have led these big picture analysts to predict the growth in demand for Australian raw materials like coal and iron ore. An investment back then in companies like Rio Tinto Limited (ASX: RIO) and BHP Group Ltd (ASX: BHP) would have seen excellent returns.

In 1999, Rio Tinto shares traded for an average stock price of $16.53. Today their share price is over $95 – a gain of 574%!

The professional trader

There are those among us who thrive on finding the deals that maximise returns while minimising risk. They analyse alternative stocks and scrutinise balance sheets – comparing cash flows, revenues and inventories year on year. They also evaluate the past performance of key management personnel within each company.

Armed with all this data, professional traders tend to make the sort of investment decisions that perform with moderate initial success but return solid gains over the longer term.

Share traders like Geoff Wilson of Wilson Asset Management are particularly skilled in accounting analysis and mathematics. These attributes have made him one of Australia's more successful investors, consistently capable of finding good opportunities while mitigating the associated risks.

The short-term gambler

Financial experts report that they are often approached by people asking for tips to achieve a fast return of 'thousands' of dollars. They categorise these investors as short-term gamblers.

They are as fascinated by the stock market as they are by the field of horses in the Melbourne Cup. Their approach to both 'investments' is identical.

For this personality type, the thrill of the gamble will see them take good profits in time of rapid share market growth but sadly, equally large losses when markets decline.

So, what type of investor are you?

Understanding your own personality can help you make better investment decisions. I personally favour the professional trader's approach, but it's ultimately up to you. So try a little honest self-analysis before your next trade, it can only help!

The post What type of share market investor are you? appeared first on The Motley Fool Australia.

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Motley Fool contributor Greg Butler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Economists tell us that profits we earn are the rewards for the risks we take. This could explain why some investors spend a lot of sleepless nights worrying about their holdings.

Yet ResMed Inc (ASX: RMD) is one company that is providing solid financial returns while it treats sleep deprivation disorders for millions of people around the world.

Today, ResMed's share price is over $22 and annual growth in the stock has exceeded 30% for the past 3 years. But it wasn't always that way.

From little things…

It is difficult to believe that a company born in a North Ryde garage just 30 years ago could be such a global success story today, but ResMed is just such a phenomenon.

Way back then, founder Peter Farrell had engaged the services of Colin Sullivan, a post-doctoral research fellow from Sydney University, to study the causes and effects of interruptions to breathing during REM and non-REM sleep.

Sullivan had earlier developed the CPAP breathing system, providing continuous positive airway pressure to help treat sleep apnea and other respiratory disorders. After further experimentation and refinement, Peter Farrell took the plunge and formed ResMed (respiratory medicine) to market this revolutionary new product.

With statistics showing that with between 15% and 20% of the world's population suffering from these sleeping disorders, Peter knew there was a huge market for this technology.

Tomorrow the world!

Having rapidly entered the lucrative US market back in 1989, ResMed relocated its headquarters from Sydney to San Diego on the southern California coast.

In 2013, Peter Farrell maintained management stability by handing the position of CEO to his son Mick – also a long-term ResMed employee.

Today, ResMed employs more than 7,500 people worldwide. The company operates in more than 120 countries worldwide and has manufacturing facilities in Australia, France, Singapore and the United States.

The company achieved revenues of US$2.6 billion in the 2019 fiscal year.

Driven by innovation

A litany of new products, continued research and development and innovative additions to the ResMed range have seen the company maintain its market leadership in the face of aggressive competition from some major manufacturers.

While it's beyond our abilities to promise investors a lifetime of uninterrupted sleep, we can say that ResMed shareholders have enjoyed both stability and significant growth from their investment over several years.

Market indicators suggest an ongoing future of 'business as usual' for this dynamic global powerhouse.

The post Would an investment in ResMed shares help you sleep better? appeared first on The Motley Fool Australia.

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Motley Fool contributor Greg Butler has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ResMed Inc. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.