IT’S been a nail-biting time for Irish shareholders in the past three months. After hitting highs of above 8,000 as recently as early May, the Iseq index of shares slipped badly to 7,000 a fortnight ago and is now hovering at about 7,400.

While the risk averse may want to steer clear of such volatility, “buy low and sell high” has always been the mantra of experienced stock-market investors. So is this a good time to add some quality Irish stocks to a portfolio without paying over the odds?

“We’ve come down a long way in the markets in the past couple of months,” said Daniel Kiely, a senior portfolio manager at Bloxham stockbrokers. “They have recovered a little in the past few weeks and are now trading sideways, but bouts of weakness should always be looked on as buying opportunities.”

Kiely always tells his clients to pluck up the courage to buy good quality stocks when everyone else is heading for the door, he says. “If you look at where the lows have been in the past six to 12 months and try and buy around those levels, within 10% of the lows, then you should be getting good value, provided earnings and valuations are stacking up.

“If you can sell within 10% of the high, then in between you should make loads of money,” he said.

Share buyers who try to get in when prices are low are known as bottom fishers. They can come unstuck, however, if they wrongly identify a low price as an absolute low.

Denis O’Connor, of Campbell O’Connor stockbrokers, says the time may not be right for bottom fishing just yet.

“Sentiment has changed since February or March, when the market was going in one direction — and that was up — but I don’t see a lot of value in the markets yet,” he said.

“With the fears of interest rate rises, I think the markets will be turbulent for a while. We’ll be in choppy waters for the remainder of the summer.”

He concedes, however, that some value is to be had for buyers who time their purchases well and get a good price on a weak day for a stock.

“There have been opportunities. CRH was down at €23 recently and that was certainly good value and I suppose it still is at €25,” he says. “The key to it is looking for short-term value. It is very much about timing with the markets moving so quickly."

What to look out for

Price is clearly a key consideration for anyone looking for a good-value stock, but it is far from the only indicator of value. Price means very little on its own and needs to form part of your overall assessment of a company and its stock.