Single Equity Loss

guymo

EdGasket wrote: »

Just had a 13% realised gain in 1 day. Not wishing to boast as overall I am not doing very well but it's amazing to think that that return would have taken 26 years in my NatWest cash ISA at 0.5% pa!

You are ignoring the powerful effects of compounding. It would only have taken 24 and a half years.

EdGasket

guymo wrote: »

You are ignoring the powerful effects of compounding. It would only have taken 24 and a half years.

Yes, I did realise that. I was just giving an overall impression of how long it would take to get a 13% return in my ISA. Either way its too long to wait for me; probably be six-foot under by then!

gadgetmind

Well, I know our own cash allocation (a shave under 10%) isn't going to light any fireworks, but it's there for a reason. Half is index linked and half at an average of 2% ... for now!

guymo

EdGasket wrote: »

Yes, I did realise that. I was just giving an overall impression of how long it would take to get a 13% return in my ISA. Either way its too long to wait for me; probably be six-foot under by then!

For the avoidance of doubt, I was trying to make a small joke and even emphasise your point a little bit rather than to correct you.

brasso

The OP may look back on this experience with gratitude.

Too many people have the opposite experience, often with high profile IPOs, where they make a decent profit -- before losing all the gains, and more, by branching out into more speculative punts.

I've had good years and bad over the past 12-15 of investing, but the past year has been dreadful for single share investments. I've taken quite bad losses on a number of individual shares (including Afren when they crashed first time around!). I'm now back into funds and trackers and feeling much more relaxed about things.

Kendall80

brasso wrote: »

The OP may look back on this experience with gratitude.

Too many people have the opposite experience, often with high profile IPOs, where they make a decent profit -- before losing all the gains, and more, by branching out into more speculative punts.

I've had good years and bad over the past 12-15 of investing, but the past year has been dreadful for single share investments. I've taken quite bad losses on a number of individual shares (including Afren when they crashed first time around!). I'm now back into funds and trackers and feeling much more relaxed about things.

Glutton for punishment that I am. I sold and took my losses on the chin but i'm looking for a lower entry point next week with a view to making back my 70% loss.


I researched JKX Oil&Gas last week but despite strong fundamentals and upside I decided against that option due to their area of operations (east Ukraine!). They promptly rose by about 150% in the following 2 days of course!


My dummy portfolio of 10 value CAPE shares is doing very well - up 30% on the month. I'm not willing to commit such funds to my share-dealing account though to make that a viable option. My focus being an active and passive fund ISA.

gadgetmind

Kendall80 wrote: »

with a view to making back my 70% loss.

Or just treat the loss as being a lesson in, well, whatever you choose really. I've had a few such lessons ...

Kendall80

gadgetmind wrote: »

Or just treat the loss as being a lesson in, well, whatever you choose really. I've had a few such lessons ...

A lesson in how to deal with a loss


I shall not be adding any more money to my share dealing account but I'm not withdrawing from it either. If I'm more judicious with regards my entry point I should still be able to come out of this in the green/blue/black/whatever.


I'm not risking anything I cant afford to lose.

xemeter

Kendall80 wrote: »

My first foray into individual stocks/shares has not gone well. I elected to invest in Afren last week with a view to an upcoming takeover/merger. It dropped 70% today alone and 90% overall.

I think i'll stick to funds!

I bought AFR at 5.9 and sold at 10.9, made 84% profit.

I was 140% up at one point but got a bit greedy and held out for more and then the price dropped.

Single shares are VERY risky.

EdGasket

xemeter wrote: »

I bought AFR at 5.9 and sold at 10.9, made 84% profit.

I was 140% up at one point but got a bit greedy and held out for more and then the price dropped.

Single shares are VERY risky.

AIM shares especially so. Not sure if AFREN is on AIM but they are a small stock so most likely are. I think in general AIM shares are best avoided. Look at almost any aim share and you'll see relentless decline with the odd spike up here and there. Mostly the decline is caused by endless placings to raise more cash causing further dillution of the shares. The fact that AIM is resource biased and resources have been doing poorly has also contributed to the dire performance of AIM stocks in general.