2006 - A GREAT YEAR FOR SHARES
Well, what an excellent year 2006 was for shares. I thought 2005 was good but this has been my best year ever. I wasn't that optimistic at the start of the year but apart from the May malaise, the uptrend has stayed in place.
I really hope all of you have had a reasonably good year - not every sector or share did well. But for those avoiding the likes of the poker site meltdowns, it was a good vintage 2006. In the end it was the year of the midcaps with the FTSE 250 and smallcap index doing pretty well. AIM wasn't really so great.
Buying and selling FTSE 250 shares really helped my spreadbetting accounts and I managed to clock up a six-figure gain this year spreadbetting. I have a few favourite trades to look back on. My favourite trade this year was buying Birse because I spotted a couple of sudden big trades, and I was rewarded two weeks later with a bid at a 30% premium to the price I paid!
Trades making the most money? Two stand out: Vislink and Renold. And the lesson learned from these: always top up on the good winners and buy more at higher prices. I've done this for a lot of the year and it worked. Many investors cannot bring themselves to buy more shares in a company that they bought at lower prices. Once you've learned to do it, it becomes second nature. Vislink attracted me with its microwave technology and I bought at 54p, 56p, 66p and 85p - the price is now nudging 100p. Renold looked a great recovery story and I bought at 75p, 90p and 101p - the shares are currently around 120p.
The most banked profit? Over £7,000 from a quick trade in Keller. Nice!
Worst trade of the year? Buying Interserve at 380p and selling at 290p after some fraud was discovered. And of course it went right back up again after a few weeks. Well, I guess you can't win them all!
What have I learned this year? Stop losses definitely work and I have, in the main, stuck by them therefore rectifying one of my earlier failings. Setting targets and either taking half profits or buying more around the target price has worked too. And avoiding like the plague any company that has any major problems attached to it. Just keep the good strong ones onboard.
I'll be back early in the New Year with some ideas for some shares I think will have an excellent 2007.
I wish you all a merry Christmas and New Year - my advice is to forget about shares for a few days and enjoy the good company of friends and family. Because in the end that's what it's all about!