DON’T FOL­LOW THE HERD

Finweek English Edition - - INVESTMENT -

Ellies share price has been un­der pres­sure since hit­ting R10 back in May and we’re see­ing the usual herd men­tal­ity. Ev­ery­body loved it at R10 but no­body seems to want to touch it at R7. It’s clas­sic in­vestor be­hav­iour, which frankly makes no sense. Sure, we’ve had some mod­est re­sults since that peak of R10 but fun­da­men­tally it is the same com­pany and if peo­ple wanted to pay R10, why not R7? We see it in over­all stock mar­kets, at the peaks ev­ery­body is rush­ing in, happy to pay mas­sive val­u­a­tions. Then af­ter the sell-off no­body wants to buy at the trough when stocks are ac­tu­ally at­trac­tive – it is clas­sic fear and greed. Go­ing back to Ellies, it an­nounced that clients of In­vestec As­set Man­age­ment now have a stake of some 5.13% in the com­pany. This is how one should in­vest, use a sell-off to buy qual­ity at bet­ter (cheaper) prices.

Ellies Hold­ings

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.