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Finance Friday: Investment peaks and troughs

Shares in Britain’s house builders are falling today after George Osborne said that he would now give the Bank of England stronger powers to curb mortgage lending. The Bank’s Governor Mark Carney also noted that interest rates could rise sooner than expected. More ‘forward guidance’, so anything can happen.

I have seen Taylor Wimpey fall this morning, but one broker seems to think it’s a ‘buy’ with a target of 165p. The rumours in the forums is of a takeover bid. It does seem that the current price of 105.4 is on the low side now. Is there a really a bubble in the housing market or does George Osborne’s vision stop just outside Cockfosters? I don’t think intervention by the Bank of England in the mortgage market will make any difference to the market outside of London. It might curb demand a little in London and will allow those rich foreign cash buyers to pick up more bargains.

TSB

Other shares seem to be down today too, notably Lloyds. They are selling shares in TSB with the deadline at 5pm on Tuesday for that IPO; I still haven’t made my mind up about TSB shares. They won’t have the PPI scandal hanging around like a bad smell or any of the other banking scandals such as LIBOR and fat cat bonuses. They will also have fewer branches in an era of internet and mobile banking. If they can get back to community banking and leave behind the empire building of Lloyds, they could be a good investment. Have bankers really learnt their lesson?

Graphene Nano

The last investment I made was Graphene Nano (GRPH). While, I’m still making a loss on that, it is making a gain this morning. I think it might have hit bottom and is on it’s way back up. I think the ask price has gone up today without the bid price increasing so I won’t get too excited over that. I think it has potential for a good return. The bid price is 60p and one broker has a target of 150p on that one.

Premier Foods

I still think Premier Foods (PFD) is too cheap at 60p. I have seen the price this low before and then climb to 186p; so there is a lot of potential.

Solo Oil

Solo Oil is high risk but at 0.28p a share is worth a gamble. The price did drop as low as 0.14p and so has doubled on the strength of recent rumours. The CEO also bought a significant number of shares. Some small investors are forecasting the price will go to 2p or more a share soon. We shall see!

Last week, I described my investing strategy as contrarian to the usual wisdom. I am getting a return, but there are peaks and troughs. My returns have halved on what they were last year when I was doing very well. I’m still making better than 10% so it a better return than a bank account would give. In these posts I share ideas, I don’t give advice. Investors have to make their own decisions based on information and research and companies do go into liquidation, so you can lose all your money.

Good luck if you’re investing, but be careful and diversify!

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  1. Pingback: The Review: Life is so complicated | Mike10613's Blog

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