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Hello Crazy Chums,
There's no logic in Crazyland.
When a company reports its annual profits, the share price can fall, even if they announce huge gains.
That is why we have the strange rule to buy on the run-up to the report and sell just before it comes out.
The same rule, just a little adapted, is brought to bear on take-over stories. And here the dictum is to buy on the rumour, sell on the fact.
Neither rule is set in stone. For example, Marks and Spark's (MKS.L) share price went up like a rocket when their results came out. Even though everyone expected the store's recovery to keep on going.
And some companies, which are taken over, continue to rise after the interest from a predator is confirmed.
So the only rule is: not to stick to the rules. Well, not all the time, any road up.
What are we to do then? My policy is to follow my instinct. If my heart tells me to do something in Crazyland, I do it, even if my head says it's not logical. Because, gang, there is no logic Crazyland. Rock on!
To find out more about Malcolm CLICK HERE
UKSA is the leading independent organisation for private shareholders in the United Kingdom. It campaigns to protect your rights as a shareholder and runs educational activities for members.
For more information about UKSA CLICK HERE
