BMD Analysis

Current market sentiment is riddled with fear this is due to the on-going sovereign debt crisis that is engulfing Western European country’s. Greece, Ireland, Spain, Portugal, Italy, Iceland, etc  A default is edging ever closer on Greece, it is on a knife edge, as Global Markets wake up to the enormity of the Debt Crisis. A Greek default would be cataclysmic. Even with an approved bail-out (which is likely) the Greek Tragedy will still rumble on. If they default further on down the line then a precedent is set. Others could fall. European Governments are in turmoil & stocks are suffering almost on an hourly basis. AIM stock is particularly vulnerable so remember that even if your investment is based on good Fundamental analysis it will NOT remain immune from the current meltdown. I always derisk my holdings at the first available opportunity depending on how the stock has risen or fallen & what news may or may not be currently available. There are many stocks at the moment that are trading well below Net Asset Value. The Global bearish market is still with us & looks like it will remain so for some time to come.

That doesn’t mean that you should pull the plug on your investments & take flight to Gold or Cash it means that you should remain vigilant. There are some terrific bargains out there. Ultimately the responsibility rests with you. Vigilance is the key. Gather as much information as you can from as many organizations as is possible; Newspapers, Brokers, Funds, Analysts, leading Market thinkers, Economists etc This way you’ll be well placed to form an opinion on the direction the Global economy is headed.

Remember that Broker Notes should not be relied upon as the “Gospel according to Saint Peter“. THEY DO SERVE A LIMITED PURPOSE AND SHOULD BE USED FOR REFERENCE AND RESEARCH ONLY. Check to see if the Broker who has written the “note” is actually the Nomad or the company Broker if so treat it as suspect. After all they are hardly likely to downgrade a companys’ stock that they are in the employment of. Beware of Broker-Notes they are very rarely Independent and are released by Institutions for the great unwashed.  Some notes such as those that come from Edison, Hardman or Gecr are usually paid for by the company written about. They are worthless, nothing more than paid advertisements. The whole of the City of London completely ignores them. No professional worth his/her salt would ever rely upon them. True INDEPENDENT in-house analysis very rarely sees the light of day, it is kept out of the public domain. Brokerages spend millions of pounds researching their investments they are NOT going to give it out freely.

Another point worth mentioning are “LIFESTYLE COMPANY’S” the AIM is riddled with them. A lifestyle company is one that exists purely to line the pockets of its Board. You can spot them with experience. They have usually been kicking around for years but never actually seem to progress in value & they always tap up Private Investors through placings & such like, while never actually progressing their Sp. The deals they do are usually with other company’s that they have a material interest in, IE, on the Board or a friend/family member runs the company. Stay well away AIM is riddled with them. Learn to spot them.

Remember that regardless of what you might think I can assure you that Market Makers & Brokers regularly surf financial Internet chat forums gauging private investor sentiment. The email subscription lists from the old WordPress blog has over two thousand subscribers from City of London Stockbrokers, Bankers, Hedge funds, Journalists & various Financial Institutions. Information is the key to success in the City. Regardless of where or whom it comes from genuine Information is a prized asset. Brokers, Hedgefunds, City Institutions, Bankers & all Professional City Investors will sell their soul for genuine Information that can give them the “heads up” on a company.

If you want to succeed with an Investment then you must research it thoroughly, genuine Independent advice is difficult to get but there are some Brokerages that do bend a little for their private clients.

One last but very Important point. Be under no Illusions as a Private Investor the Market is weighted against you. The City of London exists to generate wealth for those at the top. It doesn’t give two hoots for those at the bottom. It runs on Information & it couldn’t care less where or who it gets it from. Insider Trading is rife. Do not be fooled by the odd sap thrown to the FSA. Mammon reigns Supreme in London & beyond.