RE: Looking good21 Dec 2017 15:29
...and back above 870p, shows the new demand for these shares. If we are lucky, then the mentioned consolidation could be over and as from Monday this could make fresh attempts at 880p.
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"I did think about buying another £20k worth of the shares but it would have taken several days to get the money out from where it is currently sitting. I believe it will be 9.40 again, but the question is when." TheTraveller
No advice meant, but better not try catching a falling knife, if you already hold the amount of shares you originally wanted. In this case its best to allow the share do what it has to do ...find real grip.
The most important question for a large cap investor is to secure his capital. So if you hear of a sure thing consolidation (like with PFG when it breached 880 and 860p) and the Sp already dropped to an inacceptable level, then its better to take a few coins off the desk.
Better to take an acceptable small loss, with lets say 40% of the holding, and let the remaining shares run until they find its bottom and finally recovery and return bringing you some of your capital.
Here I see three options:
1) Purchase a small stake during a share hype and that 940p spike, so you secure to be part of the game. Then wait for each retrace and buy always larger chunks - until you reach your desired target, those 90k pounds. I think this is a good option, and an initial purchase of lets say 5k worth would not have bothered you during the last weeks. At the same time you would have pumped in more money for prices like 830 / 800 and even 790p.
2) AT sell of 40% of your holding when the 880 or 865 support was breached, let the remaining 60% dive down to those silly lows the other day, totally unbothered for you. Wait for the rebound (and its confirmation) and slowly buy back your former stake during rising prices like 720 / 750 / 790 / 810. In this case its best to place three or four super low AT buys and let them trigger.
3) Take a very risky bet, stay invested with 100% of your capital and see if the Sp keeps holding those 850ish levels or not. If it drops further, then watch it drop, chew nails, see it drop to those ridiculous 700ish levels the other day and hope for better times. Then watch the rebound free additional (fresh!) capital and put that also on the gambling desk (or in the oven).
The first two strategies are an option in my opinion. The third is not.
When breakeven?
Provident Financial Group will likely trade around 950p by mid January. The most important question for you will be what to do next? What will you do then, once that PFG has become a money maker again? Will you jump ship as from 950p?
I will not.
I want to see the mentioned 1,190p target.
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