How can I decide which shares to buy in KSE?

1 ANSWERS

1. Guest4193
   

   A stockbroker carries out buying and selling on his propriety accounts and on behalf of his clients as individuals cannot deal for themselves in the market. A list of stockbrokers is available from the Stock
   
   Exchange on KSE website www.kse.com.pk. Stockbrokers offer a variety of services but if you know exactly what you want, simply call the broker for an 'execution only' service and ask them to buy the shares of your choice. KSE offers three market segments
   
   a) Cash market based on two day clearing and settlement
   
   b) Continuous Funding system (CFS) MKII where cash market's net purchases can be carried over for another 22 working days
   
   c) Deliverable Future Contracts allow investors to purchase or sale on a forward contract basis clearing and settlement of these contract takes place on last Friday of the months and new contract starts on the following Monday Cash settled Future Contract where contract is for 90 days, but investor has a choice to enter into any of the three contracts that are always open for end of the month expiry based of cash settlement with under line cash market price of the scrip.
   
   2) After having instructed your broker to buy shares, the broker will draw up contract notes, which typically are sent to your address or mobile phone number within next 24 hours. This will show details of the transaction carried out on your behalf.
   
   3) You must send payment for your shares immediately upon receiving your contract note. In June 2007 the Stock Exchange adopted a two-day settlement system called T+2 system, under which transactions are due for settlement 2 working days after dealing.
   
   4) Upon receipt of payment, the purchased shares are transferred in your name in your Central Depository Company (CDC) account electronically. You are now the proud owner of a portfolio.
   
   5) At this stage you can sell your shares if you wish. You are now entitled to attend the company's Annual
   General Meeting (AGM). Talk to the other shareholders, especially representatives from the institutional investors. Just one sizeable disinvestment could make all the difference to the outcome of your overall operation.
   
   A stockbroker or financial adviser can help you choose which shares to buy, and advice on the best time to sell.
   
   You will need to decide:
   
       * Will I need the money soon?
       * On the other hand, can I leave my money to grow over a number of years?
       * Alternatively, Do I want a combination of both?
       * How much money can I afford to invest?
       * Will I spread this over a small number of shares, or a larger number?
       * Do I want to invest directly in shares?
       * Do I want shares in blue chip companies, medium-sized companies or new, small companies (which can be less secure)?
       * On the other hand, do I want the relatively safe government backed investment schemes available through National Saving System (NSS), or Pakistan Investment Bonds (PIBs)?
       * Am I interested in indirect ways of investing, through closed end Mutual Funds or through Term Finance Certificates available at the Stock Exchange?

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