The historic falls in the value of Australian equities through 2008 have left investors extremely weary.  Many are asking questions like:  How far will the market fall? When will the falls end? Should I get out? Etc.

I would love to be able to provide the answers for investors but the reality is that I along with every other “expert” really have no clue.

The truth is that no one can provide any definitive answer which unfortunately only helps to add fuel to the fear.  Our approach is to look at the fundamentals of investment markets through history and promote a cautious approach to investing using whole of market style trusts – See our Building Portfolios page for more detail.

Unfortunately the great amount of fear being experienced in markets brings out some less than scrupulous characters.  A few weeks ago I received an unsolicited offer from a group called Hassle Free Share Sales.  This generous organisation offered to buy my Woolworths shares from me.

(As an aside, some may ask why I hold shares when I promote a passive investment approach to investing.  These shares were the first shares I ever owned and were purchased in Woolworth’s IPO in 1993 – so they have some sentimental value along with some significant capital gains implications if I were to sell them.)

Back to Hassle Free Share Sales – they offered to buy the shares for $14.45.  The market price at the time was $28.90.  It is now $26.08 – Friday’s closing price.  They also stated that there would be no brokerage or stamp duty.

Thanks very much but no thanks!!!

What groups like Hassle Free Share Sales and others (including probably the most famous operator – David Tweed) are trying to do is prey on smaller investors who may be less sophisticated in their approach to share ownership.  These investors are the most vulnerable at current times.  They hear, and read all the fear thanks to the media but are less likely to have a financial advisor or even broker assisting them in their decision making.  This offer comes along and it seems an easy way of selling their shares.

Please don’t do it!!!

If you feel you can not take the stress that you might be feeling at the moment and / or you feel you have to sell than you should take the time to get proper advice and sell your shares on the market at the best price you can, not through a shonky operator like this.

For more information on this topic take a look at the following links:

- NSW Government Office of Fair Trading warning in December 2007 about Hassle Free Share Sales – Be wary of share buying offers
- A recent article from Vanguard on the topic – Taking cruel advantage in a troubled market
- ASIC’s Financial tips and safety checks site – FIDO – Unexpected offers to buy your shares
- David Tweed’s Wikipedia entry – http://en.wikipedia.org/wiki/David_Tweed

Regards,

Scott Keefer
Financial Advisor based in Brisbane, Australia

Scott Keefer is the General Manager of A Clear Direction Financial Planning based in Brisbane, Australia. He has been a partner in the business since January 2007. He has completed a number of degrees related to financial management including a Masters of Financial Planning and Bachelor of Commerce. He also holds a Graduate Diploma of Education.


He is an Authorised Representative of FYG Planners Pty Ltd, Australian Financial Services License 224 543.


Prior to joining the business, Scott was involved in secondary education where he held middle management positions in schools in Brisbane and Jakarta, Indonesia. Part of these experiences involved teaching Indonesian students about Business Management and Economics principles as relate to the Australian context.


Scott is a co-author of the book ‘It’s Time You Knew the Truth: Building Investment Portfolios That Work’ and ?A Clear Direction ? Your Guide to Being a Successful CEO of Your Life?. He has a passion to work with people at all stages of the financial planning process helping them to build successful financial solutions through well structured investment portfolios.

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