Nervous about a market reverse

PUBLISHED: 28 Feb 2012 @ 10:18 | Comments (0) | More info about Clem Chambers

This nervousness is nothing new as I’ve been unhappy with the market the whole time I’ve been buying back in.

The market has had a great run up and I’m nervous it could go into reverse for a bit. However it it rallies further it will rocket.

Every now and again I buy a little splash of a crazy stock. These stocks are written off in my head as ones that might go to nothing, but have a slim chance of rising a ton. On average these punts provide me with a big over perform but the risk is very high.

As such I bought a tiny sliver of PV Crystalox. I like the chart. I kind of like the story. However it is undoubtedly between a rock and a hard place in the current economic climate. My little punt is on it not being as dead as the price suggests. If it isn’t I will make a big percentage profit, if it isn’t I will lose a peppercorn or two.

This kind of punt is all about capital management which can be translated into an easy acid test. Do I care if I lose the lot? If the answer is no, the position size is right.

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