Robbie Burns
Robbie Burns's columns :
28/11/2005Oil be Blowed!
14/10/2005The Naked Trader Book
30/09/2005Market Downturn?
11/09/2005Soaring Portfolio Strong Markets
30/08/2005Get Rich Quick Greed
10/08/2005All about IPOs
27/07/2005What's the best way to go Short?
13/07/2005Trend Timing - Let the Trend be your Friend
08/07/2005Terrorism and the Stock Markets >>
28/06/2005London Stock Exchange SETS mm
13/06/2005Holiday from the Markets
23/05/2005Penny Shares
09/05/2005A Cautionary Tale about Stock Gossip
25/04/2005Making Money from the Markets
11/04/2005Buy Winning Companies not Losing Ones
29/03/2005ISA Shares
13/03/2005Trading Patience
28/02/2005The Bear Necessities
16/02/2005Stock Market Psychology Seminars

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Robbie Burns – The Naked Trader

Robbie has been trading full-time since 2001. His book "The Naked Trader" (which also has useful information on how to use advfn) has become one of the biggest-selling finance books, reaching the top 150 books on Amazon - order it here. Trades made for Robbie's website have amassed profits of more than £300,000. You can read about his buys and sells daily at

Terrorism and the Stock Markets


What is the best thing for traders/investors to do in the event of a terrorist atrocity?

It's hard for newer investors to know what to do when they see all their stocks tumbling and when the human reflex is for flight: that is - sell everything. In fact, a quick look around ADVFN's bulletin boards showed that many did just that - sell up at any price.

Older hands, like me, who have been in this situation many times, do nothing. Of course, the City is supposed to be about dog eat dog. Many might feel that a panic tumble of stocks gives them an ideal chance to top up on favourite stocks at discount prices or indeed, perhaps try to make quick money by shorting.

My personal view (and it may be too moral for some) is that I don't want to make money from other people's misery. I did nothing - tempting though it might have been to pick up great stock at sudden markdowns.

Taking the moral standpoint aside, those trying to sell at a time of panic face a lot of problems. Market makers cut links to brokers, so online dealing becomes next to impossible. Spreads get widened and if you want to get out, you'll find the price offered could be even lower than seen on screen.

What you are, in effect, doing by panicking is probably making yourself a lot poorer. And if you want to buy back the stock that you sold in a panic, you'll probably have to buy back in at higher prices, and there's commission and stamp duty to pay.

My view is always this: think of Corporal Jones in Dad's Army¬Ö and don't do what he does, which is jump up and down and panic. Similarly, don't act like Private Fraser thinking we are all doomed. The human spirit is strong and we come out of adversity quickly.

As for me, my do nothing stance proved correct and, a day on from the bombs, most of my stocks are back to where they were before the panic, and some are even higher.

Let us hope there is never again another terrorist event. But if there is one, my advice is to switch off trading screens. Modern stock markets now appear to quickly discount terrorist activity.

My thoughts are with those families now having to deal with the horrific consequences of the bombs. Let us all, in our own way, take a little time out of our busy days and pray for them.

After all, it could have been any of us.

You can read Robbie’s daily market comments together with his latest buys and sells at his website

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