The bigger they are...

Thursday, 22nd July 2010 10:29 - by Boredmum

The bigger they are, the harder they fall. Being only 5 feet tall, I have never really experienced that concept until now! I have always had a set amount of money that I invested in company shares; an amount that I was comfortable with investing. If there was a fall, or even a large percentage drop, I wouldn’t be looking at too much of a monetary loss. Well, things change. I’m not sure why, but I am investing more and coming out of that comfort zone. It may be my attitude to risk; feeling more confident in my strategies or just realising that bigger and ‘easier’ gains can be had. It is probably the fast speed of turnaround which has done it. With shares like Petro Matad (TIDM code: MATD), I can be in and out in less than a minute, and a few days later again in and out in 30 minutes for a quick gain. In the case of Regal Petroleum (TIDM code: RPT), when it fell quickly a couple of weeks ago I got caught out. That was my first experience of just how quickly you can lose substantial amounts when you are investing more. I was lucky to get that back in the case of RPT, but it was frightening. The many investors I see holding Churchill Mining (TIDM code: CHL) tend to say that it makes up a large percentage of their overall portfolio. For anyone watching the drop last week on CHL, that truly was frightening…a 10% fall in what seemed like minutes. I know how those investors felt. When you have a large investment and see a quick 10% loss in value, it is worrying. For CHL, it seemed no explanation was there for the drop. As I type, the price has been creeping back up. It is certainly worth remembering...the bigger they are, the harder they fall. Make sure that you adapt your reaction time accordingly.