Uncertain investments #finance
In life, we always have uncertainty and some periods are more uncertain than others. Most people try to avoid drama and want a quiet life. We want certainty in an uncertain world. It is the same when we are investing our money, we want certainty and stability but politics and religion make for constant uncertainty. Today, it is the referendum that makes markets jittery in the UK, but many problems around the world add to the uncertainty.
When we make an investment we know the future of that investment is uncertain so we do our research and we make a judgement. There is no such thing as a safe bet. We can, however, estimate the risks. Those risks change daily and so do stock market prices and indices. This morning, the FTSE all share is up 1.43%, but there is no guarantee it will stay up. The slightest bad news could wipe out the gains. My portfolio is up because it is fairly diverse and so I’m up just over 1% with all my AIM shares flat. The AIM market is really uncertain, but again, you assess the risks and make a judgement. I have too much invested in that market. I only need one to take off and the risk is justified. I’m expecting Solo Oil to take off when they release a series of good news about gas sales. When will that be? Next month, I hope!
Value can be stored up in our investments and I regret not buying Premier Oil when they were down to 32p. The price is very unstable but keeps on rising. It is over 74p today, up another 4%. The price is being driven upwards by a rising oil price, but the future of the oil price is uncertain. We still have a glut of oil, the supply problems sending the price up appear to be only temporary. We are close to $50 a barrel for Brent which could put many US producers back in profit and be great for low-cost producers.
The mood of the market
The mood of the market appears to be watch and wait. We are waiting for the referendum to be over. The only bright spot is Premier Oil where investors are dancing on the tables. My hopes for Premier Foods are that it will continue with it’s overall of the company. Now they are in profit they have money to spend on marketing and hopefully, in the long term, they will get back to making exceeding good profits as well as exceedingly good cakes. The cakes incidentally, are still being heavily discounted. If they can establish the brand as a premium brand again, then they can return to the full retail price with discounting boosting sales at times of the year when sales are traditionally low.
With BHS customers looking for an alternative, Debenhams sales could benefit. I hope forward-looking traders will buy Debenhams or I might have to stay in longer than I had anticipated.
Those are my thoughts on investing this week. My investment in Zopa looks better than my stock market investments at the moment but in an uncertain world all that could change.