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Investments | Royal Mail

It seems that the General Public offer for Royal Mail share is already over-subscribed. “The price at which Royal Mail shares will be offered is expected to be between 260p and 330p per Ordinary share of 1p, and will be announced on, or after, 11th October.” It seems likely that the price will be close to £3.00.

The price will be announced next Friday, but if you want to participate you have to do so today or Monday. The offer closes at midnight on Monday.

The Royal Mail has problems, people are sending fewer letters as we turn to things like email. Parcels and small packages offer greater opportunities as we buy more online from the likes of Amazon. You have to remember too that the price of a second class stamp jumped spectacularly from 38p to 50p which seems like an abuse of a monopoly position; but did add to profits.

I haven’t decided on Royal Mail shares yet, I have to do so today. It would make for a more diversified portfolio. They have promised to pay a dividend next year too. I think the amount they are reserving for dividends of 200 million will probably represent around 7% of the companies market capital. I suspect that one scenario could be that the price will be set too high and will fall soon after trading in the shares begins. If they are priced around £3.00, they could fall as much as 20% in the short term. Investing is a long term thing through; speculating is a short term thing. Royal Mail could be bad news for the speculators.

Investing in Art

I went to an art gallery yesterday and I saw some exhibits that were for sale at what I considered to be bargain prices. Many people see their homes as investments and so why not invest in something else that you can enjoy? Buy a new art work to adorn the walls of your living room and enjoy them as conversation pieces and they also serve as a asset that adds to your financial security just like your home does. Investing in art is a growing trend that is filtering down to middle England.

None of my views on investing should be taken as advice. Investing is risky and it’s personal. You can share your thoughts on it, or anything else in the comments box. You can also follow me on Twitter.

One Response

  1. Pingback: Black Country creativity | Mike10613's Blog

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