Brewdog Shares

[Deleted User]

Interesting that you have managed to quote some of my posts but not others. I have said twice I think I accepted the risk. The issue I had was that other investors had walked away with their money.

eskbanker

https://forums.moneysavingexpert.com/discussion/comment/81919111#Comment_81919111

If you've accepted the risk then why do you have an expectation that "some would have to be put aside to cover the investment should the company go under", which is very much not what you bought into?

[Deleted User]

https://forums.moneysavingexpert.com/discussion/comment/81919117#Comment_81919117

That was after you asked me about what could be done in future.

eskbanker

https://forums.moneysavingexpert.com/discussion/comment/81919127#Comment_81919127

So you accepted that there was no such protection for the shares you bought?

[Deleted User]

https://forums.moneysavingexpert.com/discussion/comment/81919136#Comment_81919136

Yes. Not sure why you thought I would expect there to be.

From my first or second post on this topic I was suggesting ideas. That’s it. MSE has been unable to move beyond pinning blame with the retail investor. A truly fascinating experience.

eskbanker

https://forums.moneysavingexpert.com/discussion/comment/81919141#Comment_81919141

It's because your response to the collapse seems to have been to lash out in all directions that it must be someone's fault, rather than simply accepting that high-risk speculative investments often fail.

[Deleted User]

https://forums.moneysavingexpert.com/discussion/comment/81919150#Comment_81919150

That’s how you and others have been trying to push this. The reality is that I stated early on I accepted the risk, £500 wasn’t the end of the world and I even made some of it back.

My issue was with how others had walked away with millions, and how I thought that was wrong, and in future perhaps the regulators could look at it.

I haven’t lashed out at all. Not once. I think we have said everything we can about this.

eskbanker

https://forums.moneysavingexpert.com/discussion/comment/81919158#Comment_81919158

Yes, agreed it's getting a bit repetitive, but to be clear, by lashing out, I mean that you were asserting that there's insufficient regulation and/or legislation, rather than actually accepting that there are high risks that are inherent in investing in individual small-cap companies.

[Deleted User]

https://forums.moneysavingexpert.com/discussion/comment/81919177#Comment_81919177

Yes that’s correct.

I guess it’s a matter of opinion how much you think regulation should place a part. And if companies should be able to do this with such methods of investment.

Dead_keen

In relation to:

My issue was with how others had walked away with millions, and how I thought that was wrong, and in future perhaps the regulators could look at it.

This is the case almost everytime a company lists on the stock exchange. Some of the shares that the investers buy in an IPO are newly issued (company keeps the money, well it does after fees) and others are secondhand (former shareholders keep the money).

In the case of a listed company, it is "the market" that determines whether this is acceptable. If too much of the new money is taken by existing shareholders then the offer price will reduce. If it goes down too much the shareholders will take less or the IPO will be pulled. And by "the market" I mean the sophisticated purchasers of shares, not retail investors. In effect, retail investors are protected by (i) the process for completing and reviewing the listing particulars, and (ii) the market setting the price.

I don't follow Brewdog but there is a proper prospectus (unlike what you see on some sites that only allow certified HNW/sophisticated investors). So there is protection similar to IPOs (but not the same and not as robust as listing particulars). But there are no sophisticated potential purchasers to determine whether the price is right for the risk and rewards of owning the shares as it is aimed at retail investors. So the existing shareholders will ensure that the offer price is not too low. But the element of price discovery for what is too high in an IPO is completely missing, meaning a huge amount of proction disappears.

Comments about the "small print" being the small print is frustrating as someone who used to write some of it. But I struggle to see how I can make an investment decision (absent "the market" doing the pricing for me) without reading the small print. And as I mentioned earlier in the thread, an 18% compound return on shares I don't own is too high for me and higher than I have seen before.