Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
They have restricted the purchase of 50 stocks RR being one of them.
One way of looking at it is they have identified RR as a stock that fits the profile to be shorted and is being shorted. Obviously that is not a good thing if institutions are betting that the SP is going to fall.
There is the Reddit effect but I’m not sure millennials would rally to support an engine and military defence company.
But I’m sure it’s just preemptive and the restrictions will be lifted
Taken from their website
——————-
Amid this week’s extraordinary circumstances in the market, we made a tough decision today to temporarily limit buying for certain securities. As a brokerage firm, we have many financial requirements, including SEC net capital obligations and clearinghouse deposits. Some of these requirements fluctuate based on volatility in the markets and can be substantial in the current environment. These requirements exist to protect investors and the markets and we take our responsibilities to comply with them seriously, including through the measures we have taken today.
Starting tomorrow, we plan to allow limited buys of these securities. We’ll continue to monitor the situation and may make adjustments as needed.
To be clear, this was a risk-management decision, and was not made on the direction of the market makers we route to.
———————-
I think they have restricted many of the most shorted stocks to prevent another Reddit effect.
I bought in at 94
The cash burn is high but they have easily enough money to get through this world pandemic. The only downside for me is the growing chatter about shorting the stock.
It’s crazy that professional analysts rate the same share from 42p to 157p something is not right.
In 12 months I hope my purchase will look like an absolute bargain.
Unless you are swing trading or spread betting this volatility means nothing.
If you take a long term view and hold this share within a mixed portfolio you will do very well.
It will not be a stellar performer but I can see it reaching £2.50 over the next 3 years
For disclosure I have sold out of all my short term holdings over the last month as I have an investment strategy that is based purely on % profit.
I do feel that RR , IAG and others are priced on what may be instead of current real value. This may be fine for RI’s but institutions are more regulated this obviously results in large swings.
In my opinion , if not swing trading , these shares are best put away for a very good long term investment , if not one will go mad trying to time the market.
The only negative is if the defence arm is separated out and sold off which would be a disaster.
We have - but we are still in transition so not much has changed- what will happen to the financial institutions if they can not agree /renaque on financial passporting. They have already said brass plaguing will not be sufficient to gain market entry.
This is more off a threat to banks than Covid
It’s been a lifetime of grief - my wife worked for them and she used to get her bonus in shares and participate in the salary share scheme. I can remember them being £42 before the 4 /1 split and also when they touched 40p in the financial crisis. An emotional roller coaster!
Sorry 135 getting mixed up with IAG
I suppose it depends on your investment strategy and whether you are looking to build a long term portfolio. Speaking personally I too bought in at 90 but I sold out a few days ago at 145 the profit was just too tempting.
I used some of the profit to add to my Lloyd’s holding (no recommendation)
CGT - have you got ant ISA allowance left?
If you are playing the markets I think hold off as there is still going to be a lot of volatility and it will still be possible to trade the graph.
If looking for long term investment then it does not matter too much. This share together with a couple of airlines will turnout to be a very profitable long term buy.
IMO
I think one should still be careful with this share. For disclosure I sold out today at 1.445.
The vaccine is certainly good news but be mindful it was a press release. Hopefully analysis of the full results will be just as positive - but to get the world travelling again will take sometime.
Lots of battered shares roared back today but I think a lot were over bought.
I imagine IAG will be significantly higher when this is all over but I still see a few notable dips en-route.
Totally agree - I have a long term portfolio with blue chip , dividends paying stocks and a mixture of bonds , started 30 years ago.
I also have a higher risk diversified one and finally a separate one for day trading and very high risk ( gambling ) PMO fits into this one . I currently do not hold PMO but have day traded it a couple of times making roughly 5% each time.
If I did I would vote yes if not I fear PI’s will be wiped out.
Don’t let this experience put you off - learn from it and move on.
Castle
Thank you - a bit of luck to start with went in quite heavily at 168 and sold out at 218.
I’ve then been riding the up and down wave before ditching at 216 before rights issue. It’s really addictive I had a plan not to get in again until sub 75 but had a rush of blood. Not too much damage as managed to get out quiet quickly.
I really feel for investors who rightly supported this good share before the virus as I think it is going to get really messy.
I’ve done really well trading in and out over the last 6 week selling before the rights issue. Unfortunately I got suckered back in 112 but luckily I managed to dump them at 109 before they hit their lows
I will not touch them again until the new shares start trading and can gauge institutional sentiment
Very short post I was being glib. There is always a data point that makes your averaging work. But with IAG with such downward pressure this is not the case.
Also you are losing the opportunity to off set some capital gains tax against more profitable shares held outside of an ISA.
If you dump at £2 your maths do not work out
MacRs
I understand- the world would be terrible if we all agreed with each other - l appreciate other points of view.
MacRs
I understand the principle of averaging down but on a falling stock that you believe will eventually make a come back - mathematically you will maximise your profits in the long term by complete sell outs and re-buys. I understand why investors do not as there are human factors involved but purely from a dispassionate point of view it does not make mathematical sense. IMO.
George - by selling out completely and buying back cheaper offers much better returns in the long run then simply averaging down. If you sold out 5000 iag at £2 today you could get back in with 10500 shares.
Minimising losses is just as important as maximising gains IMO.
I never understand averaging down. If you truly believe a stock is going to fall why not sell out completely and buy back at cheaper price . This disposal can also off set tax and capital gains etc.