Shareholders are often victims of Stockholm Syndrome – I’m no exception.
I bought and sold Glaxo often in the 1980s and 90s, usually making money. Now I hold a chunk in an ISA. You might think GSK are in the right part of the financial forest to do well in the pandemic but you are wrong.
It’s where it was ten years ago. The only saving grace is it pays a dividend in excess of 6% and because I reinvest the divi I haven’t lost anything but nor have I made much. Why don’t I shrug and sell? Illogically I imagine that its day in the sun will come again, meanwhile my capital could have been better deployed.
Other shares have taken me hostage because I have a big Capital Gains Tax liability – notably Caledonia. I bought in 2003 at £7.88 and today it’s £27.90. Looking this up I notice I sold Scottish Mortgage in 2015 at £2.53. Fortunately I didn’t sell everything as today it’s one of my biggest holdings worth about £12. As I travel down memory lane I marvel how such a sophisticated investor, as I ludicrously consider myself, could have bought a share in 1990 so unpromisingly called Silvermines. In fewer than three months I lost more than a third of my money and cashed/crashed out. I should have remembered Soapy Molloy’s oil stocks and smelt a rodent and I should have read this.
“The propensity to swindle grows parallel with the propensity to speculate during a boom.The implosion of an asset price bubble always leads to the discovery of frauds and swindles.” (Manias, Panics and Crashes, Charles P. Kindleberger, 1978)
I hope it discourages you from trading crypto currencies.