Rights Issues - Hard lessons to learn

Sunday, 14th June 2009 08:53 - by Boredmum

Well, I made the decision to sell my Mecom Group shares (TIDM code: MEC) at a loss. You see, when I bought into Mecom this time it wasn’t as a long-term investment, more for a short-term trade. Some of you may remember that I unfortunately missed the rise, due to a mixture of distractions and greed, and didn’t get the profit I was after. I called it wrong and thought that, what with the coming Rights Issue, once their debt issues were solved, then the share price would rise and I would get another chance. News of the Rights Issue came and unfortunately the share price fell. I thought long and hard about taking up the Rights Issue. £1,100 for a short-term trade, down 40%...did I really want to give them another £1,800 in the hope I would see profit? Almost £3,000 invested in a share that I had called wrong. I am afraid for me the answer was there. So, I sold at a loss of about £450. Did I feel better for it? I did until the next day when they made a disposal and the share price started to rise. I felt that MEC ‘owed’ me, so bought back in, hoping to make something of the rise. Inevitably, the rise stopped right there - another £120 gone. So, now I am totally out, licking my wounds and taking on-board the lessons learned. I wish the best of luck to everyone who holds MEC. Just because it didn’t work for me, it doesn’t apply to everyone. So hoping you all trade it better than I did!