Ok, I have been asked by lot readers lately about the share market drop and what to do. Here is an overview of my position and a few ideas I want to bounce off you.

The market has taken a tumble but I have not lost (on paper) anything to this point. The total sum of everything invested is still above the total sum paid for the investments. Please remember this is mainly due to a long term investment strategy. I haven’t sold out in previous panicks / drops and not this one.

Looking at it from a yearly return point this year isn’t panning out to well so far but I am of the opinion you take the bad with the good….. and now is the good if you take a certain perspective.

Now is the time to buy is it not? Unless you think the market is going to go much lower or you think it is never going to come back.

I think the market may go lower (I don’t know) but I am pretty confident it will be back and higher than it was some point down the road.

Being that it may be a good time to buy, I would like you to have a think about things and let me know if any companies come to mind that may be suitable for purchase at the moment.

We need to ask ourselves the below 5 initial questions to determine the type of company we may be interested in owning. If the company/s pass these first few questions we can proceed to further investigations.

Think of some brands / products or service that you use. Products that you prefer to purchase above all others and may have the following….

1. Does the company have an identifiable consumer monopoly?

2. If there is a consumer monopoly what chance is it that it may be obsolete in 10 years?

3. Do we understand how the company works it works? Ie is it straight forward or all confusing

4. Is the company conservatively financed? Ie. It carries low debt

5. Does the company employ hot receptionists?

Throw some names out to me and if they meet the above criteria we can work through the next step and carry out some valuations to see if they are suitable for purchase.

Lets work together to create our own ‘Woodstock for Capitalists’.