Good day!
I see Dialight (LON:DIA) is down again, to 409p at the time of writing (mentioned in yesterday's report). It just shows that, when something goes wrong, selling quickly is a good idea. This is where we private investors have a massive advantage over institutions - if anyone buys more than about 1% of a small cap, then when something goes wrong, they are left high & dry. They often can't sell, even if they want to. Whereas you and I can just ditch a bad company unceremoniously. OK it might mean taking a loss, but we live to fight another day, and can make up the loss on something else.
So my thought for the day is that forming an emotional attachment to a bad share, and hesitating over selling, is the biggest unforced error that most of us make. If/when something goes badly wrong, then ditching it on the opening bell is usually the best thing to do. I like to get my sell order into the market, and executed, whilst the institutions are still worrying about what to do, ahead of their first committee meeting of the day. I'm long gone by the time their sell orders come in, and smash the price. That's the theory anyway.
Apparently we're all meant to be terribly worried about China. I'm not. According to someone on Twitter, the UK exports less than 1% of GDP to China. Lower commodity prices makes everything cheaper, thus boosting a services based economy like the UK. So the way I look at things, investors in resources stocks might be getting massacred, but that doesn't affect me. It won't affect the number of conservatories that Entu are going to sell, nor the number of frocks that BooHoo shift. All in all, it's just background noise for a long-term UK small caps investor, in my opinion. There's always something that people fret about. Bottom line for me, if I hold good value shares in decent UK companies, then what the Chinese stock market does is completely irrelevant.
There's not much in the way of news today, hence the ramblings.
Somebody in the flats over the road (I'm in Islington) is obviously smoking a joint, as the pungent aroma of cannabis is wafting into my room. Who needs sniffer dogs when it stinks to high heaven like this?!
