Shares
Shares are a great way of giving you the opportunity to own a piece of a business.
This can be large established companies that we use in our lives every day, like Woolworths and Telstra. It could also be much smaller companies that are emerging within specialised industries, like biotechnology and resources.
Some of the other benefits are:
- There are shares and strategies available to take receive regular income or long term capital growth;
- They are liquid, meaning you can sell your shares at anytime and get access to your funds within a few days;
- You don't need a lot to get started, and don't need to worry about legal fees and stamp duty like property investments.
CPW can make it easy to start any share trading or investment using our sophisticated technology.
Options
These securities, also known as Exchange Traded Options (ETOs), have a variety of uses within a portfolio.
They allow you to employ a range of strategies within your portfolio, and can be as simple or as complex as you wish.
You can use options to:
- Protect your existing portfolio against adverse market movements;
- Generate additional income within your portfolio;
- Gain additional leverage to potentially increase your returns;
- Take advantage of market movements, whether they be up, down or sideways, without committing large amounts of capital.
CPW can show you that trading or using options can be as easy as trading as shares.
Margin Lending
Borrowing to invest, otherwise known as gearing, gives you a wider range of investment opportunities and increases your potential returns. It works on the same basis as borrowing money to buy an investment property.
By borrowing to invest using a Margin Loan, you obtain greater exposure to price movements, dividends, distributions, corporate actions and franking credits.
Once you establish your account with a margin facility, you simply transfer your existing shares or cash into your account as collateral. These balances will determine the lending value, which determines the amount you can borrow.
You can buy, sell, transfer cash in and transfer cash out as much as you like - as long as the amount you borrow from the loan never exceeds the approved limits. Your gearing level fluctuates with the daily price movements of your portfolio and the transactions that you make, and you must monitor it to ensure it stays below the approved limits.
ETFs
ETFs, or Exchange Traded Funds, are portfolios of stocks, bonds or other investment types that trade on an exchange just like a share.
ETFs aim to replicate the performance of a particular index, e.g. the S&P/ASX 200, and are therefore made up of the same shares as that index.
Investing in ETFs can provide the same diversification as investing in many different securities individually, but without the associated costs and inefficiency.
ETFs have an open-ended structure, which allows units to be bought and sold as investors enter or exit the fund. This means ETFs are traded at a unit price close to the net asset value of the underlying portfolio.
An ETF's price is valued throughout the trading day like a share, and it can be bought or sold with the same T+3 settlement times as shares.