Hi All. When we're down-trodden as we've been for a while, its...

Hi All. When we're down-trodden as we've been for a while, its good to reflect on our position and our strategy going forward. What's your exit plan.. are you going to play the volatility to accumulate as you await your target, or are you going to just hang tight till you're ready to hit the cash-in button?

A lot of us here have a strategy, not all of us are prepared to share it, right Pinto? But then again, big positions are tricky to manage an orderly exit from so well within your rights.

Me, strategy is to recover my initial investment, maybe when SP is $2.00, maybe $3.00 if I'm brave, then to ride out the growth wave for a couple of years with the free-held remainder.

I think its also important for everyone who is a long termer and believer in the FA to look at this market downturn as an opportunity, especially for those in the red. Obviously, averaging down is a good strategy if you have the free cash. However, I think most of us are up to our eyeballs in AJX, and perhaps a bunch of other under-performing (and less promising) specs. Mr Market's apetite for risk is hitting hard.

So... what's left to play with? Tax; the scourge of hard working folk and the life blood of the economy. I'm all for contributing my fair share, but 40-50% CGT doesn't fall within my definition of fair. Those who have SMS super funds would probably be using this downturn as opportunity to off-market transfer shares for a long term hold whilst recording a loss in their trading portfolio which is handy when they go on to actually make some trading
profits. Of course, their AJX holding in an SMS fund benefits from generous CGT concessions,

I don't have an SMS fund so for me this is what I'm doing to maximize my compensation for all this current pain. My partner has no income, so I'm transferring my holding to her via off-market transfer. I'm record the current loss in my portfolio which will hopefully offset some profitable trades in the future. My partner on the other hand is now set to hold for 12 months plus. When the time comes to sell, no income means minimal marginal tax rate for
capital gains tax assessment, and holding for 12 months plus, halves the CGT liability -- at least while the tax laws dont change.

I think that if we're not at $1.50 by this time next year, then we may as well pack up and buy telstra and commbank shares like all the other ma and pa's.

GLTA