Bought cable and wireless today at 91p. Let me know your thoughts. Is this going to be an all time loser? Despite the warnings and the fact that the company had to spend cash money restructuring i think it is terribly undervalued. I am interested to hear your opinions.
I was wondering where your stop-loss is, or at what point you would get rid of the stock. This is something you should have thought of before entering your trade.
I would also ask What makes a company undervalued? . To me there is no such thing as under or over valued stocks. The value is the price it is at, at the moment, otherwise if it was undervalued then it would be brought up by the millions until the price reached it's "fair" value.
A search on this and other sites will show that buying penny shares by novice traders/investors leads to financial loss in the majority of cases.
reading between the lines you are clearly new to the financial shark pool. Therefore dip your toes, not your head, into the water.
Try low cost spread betting, or buy a few FTSE 100 shares to test your ability at trading or investing.
know your exit before entry.
It takes time, practice and money to keep money in the market. Trading is not a get rich quick arena. To think so is the road to penury.
You could argue that marconi (to name one) was undervalued in the eyes of those that bought it or else they would not have bought it.
Your value for a share is what you are prepared to pay for it. It will be different 'value' for many others. If it wasn't different we would not have a market
I traded CW today and every upside move was sold into. This tells me that someone is probably dumping a lot of stock. It may bounce from the 80p level as it seems to have found some support here but I am sure a lot of Marconi holders had the same thought at various stages of its fall. Not that I am saying that C+W is in the same boat as marconi, just using it as an example of how quickly a 'good value' stock can fall.
I am long overnight with a spreadbet on this and Corus but will close both pretty sharpish tomorrow if:
a. they put on any sort of reasonable gain, 5-6p for CW and 3-4p for Corus.
b. The Dow tanks tonight especially if any decline is led by tech stocks
c. they hit my stop in the morning
My preference would be not to have held either overnight but I have decided that if these do open with any strength then they could be nice gainers and that a large part of the downside has probably been taken out of them today. Also I had not hit my breakeven when the market closed and the Dow seemed to have a fair amount of strength following the Greenspan moment of light ;-)
The problem with bottom fishing after a large drop is that it takes time for the news to get out to the private investors. It is 50/50 which way these go tomorrow.
Any gains now it has moved against you should be seen as a bonus. Don't hang around waiting for it to hit your entry price. If it is weak tomorrow than get rid of it.
PS. none of the above opinions should be construed as advice to sell or buy any financial instrument. They are merely my own views.
John I appreciate your thoughts, I bought in at 92p. It closed at 85 pence. I think if it opens crappy tomorrow i will dump. The problem is that it is the natural thing to hold and see if it recovers. My whole portfolio is down in my first week (irev.l bought at 1.25 now worth 1) Itk.l bought at 16 now worth 14 and cw.l bought at 92 now worth 85... Would anyone recommend i give up shares and dump my whole portfolio and take the 20 percent loss. A lesson well learned.. I am a moron
It seems as if you are not to sure where you are heading.
Just my humble thoughts, how about picking one stock from the FTSE 100 and paper trade it, and it only. ( I know some guy's on the site don't like paper trading, but until you have your set-up sorted it's safer). Stick with the one stock go long and short, until you get to know it inside out. Try trading in different time frames and see which suits you best, then when you are confident (it does'nt matter how long it takes). Go to market with the big boys and girls, but with small stakes.
Watch out for the first half hour or so when the spread will be wide. Even if it opens down you may find that you will get a better price (even if it falls from todays close) by waiting. This is because the market makers will narrow their spread once they have established which way it is going and are comfortable with the volumes.
Recognising that you got it wrong and getting out is probably the single hardest thing to learn in trading. Any idiot can get into a trade but cutting your losses and getting out when it goes wrong is a skill which few 'investors' have. I am still sitting on the remnants of a tech portfolio which is worth 10% of the prices I paid. If you get out and its cost you 20% and you remember the lesson then its probably been the cheapest introduction to trading you could have hoped for.
I rarely trade penny shares as the spread and liquidity are usually poor. Don't panic tomorrow. Try to decide if you would buy at the level the share is now at. If the answer is no or if you have any doubt then there is no doubt. Get out.
Don't let it become a disaster. Protect your capital and you will be able to trade again.
I hate to sound like a preacher but I suspect most of us here have at some time or other been in the position you are in now. The lesson most of us will have learned is that the market is totally impersonal and the only person who can make the decision to enter or exit a trade is yourself. This decision should be made without emotion. Consider the options, make the decision and then do it without hesitation. Don't sit there praying and wishing for it come your way.
If wishes drove the stock market we would all be very wealthy