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27/08/16
10:19
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Originally posted by andres
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I haven't posted on the SDL thread for a long time, but it is interesting to see the ongoing debate. I am in agreement with Donedeal , Piste Skier and Jayneen. A few points worth noting, and by the way I still have a a chunk of these useless shares in my Super Fund that I should have unloaded a long time ago. SDL is a legacy in very bad investing for which I take full responsibility. I moved on a long time ago and have 56 stocks in the portfolio; a lot of resources and very diligent in managing loss and getting involved with the right management.
It is sad to see that Westcott doesn't seem to have picked up on what the astute investors are doing these days and is hanging on to delusions about the way things really work. SDL was an exersize, a very painful one, in the ability of investors to manage their money.
1. Re SP. Whether you sell or not, your money is worth what the market says it is worth. The "haven't lost until I have sold" is one of the most irrational views around. And very dangerous as people hold on to bad positions in the hope that it will recover. It is worth what it is worth - whether you take it or not.
2. SDL offered some clear technical exits at its peak. Not heeding technicals is a recipe for disaster - especially when negative signals continue.
3. Never buy a stock in a relentless downtrend. Rule no 1. Not at any price. The overhang will kill you.
4. No matter how good the project is - the large ones often do not get developed.
5. It is a fallacy to back the project and not the management. There are lots of good projects in the hands of bad management that go nowhere.
6. It also pays to be diversified. Spending time with MDs, management, broking houses, deal makers personally will open investor eyes to what really goes on.
7. Armchair research adds very little to a good trade or investment. Macro theories are about as useful as analysts who try to predict macro outcomes. Too many variables.
8. It is a long bow to suggest investment advice re sentiment. A Forum IS about exchanges of views and opinions. "Investment Advice" regarding portfolio recommendations by professionals like brokers (ADVISERS), is a different beast.
9. Never fall in love with a story and think that you are right and the market is wring. That is a trap.
SDL is clearly a dog and looks close to administration. It wont matter how good the IO play is - they couldn't even get things going in a IO bull market, they are in a sovereign pot boiling away.
The only saving grace is that most people have already lost 99% of their money and there isn't much more to go.
SDL is a good lesson to reflect on and use as an experience to change investing and trading habits that just don't work. It is a lesson in reality versus wishful thinking.
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Hi andres
The other one I've learnt is that when the SP drops or is depressed it is not because those in the know are manipulating the price down so they can back up the truck!
So many lessons to be learnt here, it is upto us as individuals to learn from them or not.
Oh, and for the record I think it can be safely said that China isn't going to be SDLs white knight.
cheers
donedeal