Here’s hoping for a less frustrating year
THIS IS OUR LAST EDITION for 2018. And I hope when we return to pick up the first edition of 2019 that this dastardly market has found some traction.
I can’t remember a more frustrating year. There’s nothing quite like carefully monitoring a coveted small cap as it drifts into your target price range, accumulating a position, and then watching it slither ever lower — helped by rumours and gossip that tend to take hold in these jittery market conditions. Of course, not everyone is unhappy with the woeful market ratings.
We are already seeing a slew of delistings, where owners or strategic shareholders are willing to pay a premium to buy out disgruntled minority shareholders who have long lost sight of that company’s true longer-term potential.
Market lore has it that a spate of delistings usually signals that the market is close to the bottom. I certainly hope that will prove true, and that, in the process, the JSE does not lose many of its best small-cap counters.
In preparation for this edition I was looking through the readers’ stock picks for 2018.
Trust me, nobody shot the lights out. A few readers came out with a smidgen of honour — in restricting their declines to single digits.
I think I can safely say we should let sleeping dogs lie, and call off the 2018 contest (unless there is a morbid fascination with who managed the least negative return).
In retrospect, some of the comments made by some of the stock-picking readers at the start of the year might be worth recalling.
One reader justified an MTN pick with: “I see it possibly coming off a bit and recovering to the R150 level … ”
A number of readers saw Steinhoff at the R20-R25 level, and took huge hits with Pembury, Aveng, Blue Label Telecoms, Ascendis Health and Distribution & Warehousing Network.
OK, so assuming we are not too shellshocked by events this year, let’s reconvene the contest for what will hopefully be a sprightlier 2019.
So before calendar year end mail me your five share picks for the year ahead. We’ll measure the performance from the first day of trading in 2019 until mid-November, when we start putting together the last edition of IM.