TalkTalk Shares

WannaBLoaded

Thrugelmir wrote: »

What about the impact on it's existing customer base? Confidence is a key factor. Securing data wouldn't be an overnight fix either. Competitors will also be ruthless in exploiting the current discomfort.

You know when the banks were found out to be robbing us all blind, ppi, interest rigging, bank charges, cpp, mis sold insurance etc etc i recall hearing recently that despite all of this, very few people actually move banks.

This is similar, also, to when the rbs systems go down and people are told to vote with their feet to force banks to get better, yet people still do not move in droves.

I would be inclined to think that unless someone has been a victim of fraud as a result of this, the numbers actually moving may be small?

masonic

WannaBLoaded wrote: »

I see what you guys are saying, but time and time again there is a tremor, a wobble, in a relatively stable and profitable company but people lose faith because they hate the risk and drop their shares like free doughnuts and i think (i am a novice) that this therefore lessens the attractiveness of the company and the share price dips. Then, once the bad news is revealed as having not been as bad as first thought, people jump back onto the band wagon again.

In that case, you've missed the boat. The attack happened on 21st and pretty much all the details that are currently known came out into the open at the beginning of last week. The share price has since gone up 10%. It's hard to imagine there will be further good news, but there are plenty of unknowns, such as possible compensation payouts or a decision that customers are legally free to walk away from their contracts, that could send the share price back down.

One question if i may hijack a little, say you put a grand into talk talk and sold after it rose by 10%, making you £100 less trading fees, do you automatically have tax to pay on that profit?

As mentioned above, it's already risen 10% from its low last Monday. Perhaps you mean another 10%? If it rose another 10% after you invested, £100 profits would fit comfortably into your capital gains tax allowance, unless you have made a substantial amount of gains elsewhere. I'm willing to go out on a limb and assume that's not the case

Even if you made another investment in another company that was to say wipe out your talk talk profit? Hypothetically speaking.

Losses can be offset against gains if made in the same tax year or carried forward.

WannaBLoaded wrote: »

If the hack isn't as bad as first thought and causes the company to act and build a more robust defense going forward, surely it is?

:rotfl: It's the third one this year. If the others didn't lead to the problems being solved, why would this one?

WannaBLoaded

Down down down, deeper and down.

Not bought.

Read that someone set to make money out of the shares going down having a short position? What that means i don't know.

george4064

WannaBLoaded wrote: »

Down down down, deeper and down.

Not bought.

Read that someone set to make money out of the shares going down having a short position? What that means i don't know.

Its called 'shorting'.

Holding a short position is where you sell borrowed stock and buy it back at a specific point in the future. People do this when they a stock price is going to fall, so when they close the short position (by buying back the borrowed stock) they hope the price is lower than what they sold the borrowed stock at thus making a profit.

AndyT678

george4064 wrote: »

Its called 'shorting'.

Holding a short position is where you sell borrowed stock and buy it back at a specific point in the future. People do this when they a stock price is going to fall, so when they close the short position (by buying back the borrowed stock) they hope the price is lower than what they sold the borrowed stock at thus making a profit.

It's also worth noting the corollary to that explanation is that if the price goes up while you are shorting then you will make a loss - one which has the potential to be many times your initial stake.

e.g. Stock is worth £10 now but I think it will go down so I short 1,000 shares.

Outcome 1 - I'm right and the price drops to £8 per share. I'm able to buy £8,000 of shares on the open market and close my position with a £2,000 gain. :beer:

Option 2 - I am horrifically wrong, the company finds a diamond mine in the basement or some thing and the share price rockets to £100. In order to close my position I now have to buy £100,000 of shares on the open market - £90,000 loss. :eek:

Kendall80

AndyT678 wrote: »

It's also worth noting the corollary to that explanation is that if the price goes up while you are shorting then you will make a loss - one which has the potential to be many times your initial stake.

e.g. Stock is worth £10 now but I think it will go down so I short 1,000 shares.

Outcome 1 - I'm right and the price drops to £8 per share. I'm able to buy £8,000 of shares on the open market and close my position with a £2,000 gain. :beer:

Option 2 - I am horrifically wrong, the company finds a diamond mine in the basement or some thing and the share price rockets to £100. In order to close my position I now have to buy £100,000 of shares on the open market - £90,000 loss. :eek:

Assuming no stop-loss order is in place.

Reaper

Shorts can be a useful indication of what the city thinks the outlook is for a share. In the case of Talk Talk the shorts have not changed much recently

http://shorttracker.co.uk/company/GB00B4YCDF59/all

londonTiger

AndyT678 wrote: »

It's also worth noting the corollary to that explanation is that if the price goes up while you are shorting then you will make a loss - one which has the potential to be many times your initial stake.

e.g. Stock is worth £10 now but I think it will go down so I short 1,000 shares.

Outcome 1 - I'm right and the price drops to £8 per share. I'm able to buy £8,000 of shares on the open market and close my position with a £2,000 gain. :beer:

Option 2 - I am horrifically wrong, the company finds a diamond mine in the basement or some thing and the share price rockets to £100. In order to close my position I now have to buy £100,000 of shares on the open market - £90,000 loss. :eek:

dont know anything about the stocks, im pretty sure you have the right to execute the short if you wish, buit you dont have to. So if the share price increases you dont execute the short and the only loss is the price of the short.

Reaper

londonTiger wrote: »

dont know anything about the stocks, im pretty sure you have the right to execute the short if you wish, buit you dont have to. So if the share price increases you dont execute the short and the only loss is the price of the short.

I think you are confusing shorts and put options. What you are thinking of is a put option.

http://www.investopedia.com/ask/answers/05/shortvsput.asp

jimjames

WannaBLoaded wrote: »

I view shares as a gamble, unless you tie up your money into a fund that is spread over companies that are considered the safest, which was oil companies (is it still?).

You are correct, buying an individual share based on a hunch or guess that the price might rise is a gamble.


Many (most?) people on here want their investment to increase over time and are happy to avoid the rollercoaster ride that a share like this would involve. By all means buy as a gamble but it will be exactly that. But long term if you want to build a growing portfolio then funds or a balanced mix of shares is likely to be a far better option.