If you really want my view...try using the ratchet approach as the current price swing is good enough to achieve an incremental holdings increase whilst reducing your recovery cost. The price ranges between early $4 to $4.75 and the frequency is about 2 weeks, so if you have margin lending consider using that.
Buy at the lower end using the margin lending and as the price rises sell sufficient to cover the margin lending and up to 50% of own capital. As the price ratchets back down into the lower range then repeat process. Seesawing with the market as it is doing right now. Repeat as long as the range and frequency doesn't change much.
The above isn't a guarantee but it does allow you to incrementally increase your holding and reduce your recovery price her share whilst the market is making its mind up as to which way it will go. If it does drop below $4 then you may have to eject them but your recovery price should be below any trigger point you set.
I got someone into this approach a few years ago with Telstra and they still hold a very solid chunk of TLS today at zero cost now and that was less than 5 years ago. They still use the approach today and have been doing nicely on WOR and ARI lately.
Its not a new method nor the most sophisticated but its simple and works and has done for a long time so let's hope not many people read my posts here and those that do disagree!
DOW Price at posting:
$4.36 Sentiment: None Disclosure: Not Held
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