32
THE MARKET IS NOT BIG ON
CUDDLES WHEN SOMETHING
DISAPPOINTS IT.
bank and pays a chunky dividend.
Given Friday’s price fall and all that
positive stuff what’s not to like?
A few minutes before the close I
bought £4000 of AMO well inside the
spread of 79/82 at 79.39p (frankly I
don’t know how that happened, but a
result is a result) Target of 94, stop at
72.
Well, today turned out better than
I first thought it would; none of my
stops got hit and the two I bought
actually went up, so on balance good.
TUESDAY 14TH OCTOBER
7.30am, just checked the overnight
close on the Downot ‘off a cliff’ but
certainly ‘rolled down a steep gradient’
223 points (1.35%) down which I think
that will set the tone for our early
trading. Dangerous for anybody like
me who currently doesn’t have any
short positions running to hedge their
long positions.
8.30am, I’d been sorely tempted to
short Mulberry (MUL) but decided
not to as it would have purely been a
gamble based upon sentiment.
Wish I’d backed a hunch MUL is clearly
not well, down 25% so far. The market
is not big on cuddles when something
disappoints it. Other than that so far
it’s fairly calm where I am, so nothing
to do just yet.
In fact there was nothing to do all
day, everything stayed calm with the
market closing up for the second day
running.
It is a challenging time however,
everywhere you look in the world
there are big problems and above all is
the simple truth that the current bull
market has run a long time.
Trends don’t last forever, shame I’ve
got a great leather coat of the sort
they used to wear in the Avengers that
I fancy getting out of the cupboard
sometime.
WEDNESDAY 15TH OCTOBER
Today the markets came off a cliff, the
fear that’s been building up over the
last couple of weeks burst into the
open, the FTSE 100 down 181 points
and as I write the Dow in freefall.
As of the close, two of mine Angle
and Telit have gone through their
stop losses everything else is OK, the
question is, do I sell as per normal or
do I break the rules and hold because
these are market rather than company
specific moves. At times like this panic
sets in, the market makers feed on
this with the smaller stocks, automatic
stop losses get triggered which in
turn drives prices lower and anybody
trading on margin has to close before
they get torn apart.
Whilst I’m not happy, I am totally
and genuinely calm seen it all before
(usually when I was on the wrong side
of it).
The trick is to forget the money and
focus on what you think is going to
happen next and act accordingly.
Took one small step earlier, going short
on De la Rue (DLAR). It issued a profits
warning at the end of last month and
I wrote then that I would bide my
time and short the stock before the
next report. I brought the time frame
forward, selling a March contract on
the spreads (betting the price will fall)
at market 500.5. Target 350, stop 551.
Guess what, when almost everything
was going down, yeah you got it, they
closed up 1%. I wouldn’t go as far as
to say I laughed out loud, but I did
grin. They don’t call me ‘Humbug’ for
nothing.
What will happen tomorrow? Who
knows, but I’ll share it with you in DIY
Investor Magazine.
