19th August 2015. A significant day marking the beginning of a roller coaster ride that has stretched my emotions in every direction. Misery, relief, excitement, despair, disbelief, incredulity, shock. All thanks to my decision to invest in GLEN:Glencore, a mining giant with a plummeting share price that I convinced myself would be bound to turn around imminently. This view was despite the plummeting commodity prices and China, Glencore's main customer, cutting back drastically as the economy slows.
I added another £1800 to my account from savings, and bought 500 shares at 181.325p and then as the price continued to plummet, I thought "great - lets get some more" and bought another 400 at 165.325p so the total cost was £1,592.93.
Unfortunately the price continued to fall, mainly due to investors concerns at the $30bn debt - more than many small countries. Every day I looked at the share price and it had dropped some more. Glencore finally decided to act to cut their debt, selling some assets, halting production in some mines and issuing new shares to institutions. I breathed a sigh of relief as the share price sneaked up, but it was short lived, as on 28th September the share price took a dive to 68.62p. I was losing £987.85 on my original investment.
Since then the price has slowly risen to 119.2p so my loss is now at £530.83. I remain confident that it will continue to improve. Commodities are always needed, but there's been a glut of supply and demand has eased off. Demand will have to pick up at some point, as the world can't do without copper and coal.
No doubt Glencore's profits will take a hit this year, but my cunning calculations reckon their shares are worth 300p-400p so I'm in for the long haul. In fact, If I had loads of cash I suspect I'd be topping up while the shares are stupidly cheap, but my emotions couldn't cope with putting even more into a share which is currently making my portfolio balance look pretty bad.
Amid the Glencore excitement, I added another "lowest ever price" share with the cash leftover in my account. 400 shares in BLUR:Blur Group at 24.225p a share, costing £109.40. Yes - another ridiculously feeble amount that's going to take forever to pay for the commission.
Blur Group support cloud solutions which is a growing industry. As recently as January 2014 they were trading at 820p per share. Unfortunately they keep reporting a loss. The little devil on my shoulder says if it goes back to 820p a share, my £100 will turn into £3000. I very much doubt that will happen, but it's a fun one to have lying around and a better bet than buying 100 National Lottery tickets! The shares are currently trading at 28.5p, which is more than I paid for them but the increase hasn't covered the commission costs yet.
19th August will go down as a landmark day in my fledgling investment career. The experience has taught me quite a few lessons - and coloured my thinking when faced with my next share purchase, but that's another day...
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