Sometimes it is the whole market that crashes and sometimes it is one or two share prices. To limit the damage, we need to diversify and have some investments not associated with the market. Then a big drop in the part of your portfolio that is invested in the stock market isn’t quite so damaging. I have an investment in peer-to-peer lending through Zopa. Surviving a crash emotionally is a different matter. People get excited about making money and upset when they lose money but you can get used to seeing it as numbers on paper or on a computer screen. There has been a lot of excitement on the forums recently about Solo Oil and the price soared from around 0.3 up to 0.8 more than doubling the value of my investment and then this week the news from NT2 wasn’t quite what some investors expected and the market makers slashed the price.
It is nice and sunny this morning in Wednesbury. I mentioned the History Society last week and I went to the talk last night. Robert Broadbent gave us an interesting talk about the Romans building Hadrian’s wall. I know, I said it was going to be about canals last week. I think I read that on a leaflet. It was still interesting. I nearly nodded off, though, not because I was bored, just tired from lack of sleep. I was told about a Christmas event next month with a buffet, next door in Churchill’s Club, I’ll have to get details; I was too tired to take it all in.
Market makers are often the topic of discussion on the boards of investment forums. They are often blamed for all sorts of things! The London stock exchange has members who are official market makers and guarantee to trade in certain stocks. (more…)