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SGH

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54.5¢ slater & gordon limited

Bearing Fruits- More Lemon?, page-137

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jimk3758

23,207 Posts.

83

24/09/16

19:27

Post #: 19399112
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Originally posted by Dr.Who ↑

Braintot, you have good reason to have no problem with trading.

There is a paradox in statements from those claiming to be long-term holders and disparaging towards those that trade the stock.

It goes like this. If long term and not interested in trading what impact does the SP have on the long-term holders objective? Absolutely no negative impact but plenty positive. If holding for the long-term it can only be because one believes the SP will offer a good opportunity comparable with other stocks in years to come, therefore if traders are holding back the SP it offers numerous opportunities to accumulate in anticipation of that long-term above average return.

Here's the paradox, a holder might complain that traders hold the stock back yet holding it back is only a positive for a long term holder, the only person likely to be disadvantaged from holding the SP back is a short term trader that is long on the stock.

A long term holder might say well it will never recover if keep selling down. That is incorrect, when the time is right traders and other investors will demand the stock pushing it to its rightful price. If don't believe that will happen then there is no logical reason to hold the stock today.

Trading has nil impact on the long term share price if anything it creates pauses enabling true believer s to buy at a discount.

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Doc you and me disagree trading SGH. All stocks are traded but if there is instos to buffer the volatility it has little real effect on the stock. In the case of SGH there are no instos remaining and it has become mostly a traders stock. That creates high volatility which in turn keeps investors away. Until we see traders diminish volatility will remain which scares people from wanting to hold the stock and keeps SP from rising. It's a vicious circle.

Last edited by jimk3758: 24/09/16

SGH Price at posting: 38.5¢ Sentiment: Hold Disclosure: Held
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