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Market Comment

June 2007

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

Another month, another welter of panicky media reports on theChinese stockmarket. With the capitalisation of Chinese stocks beingonly 7% of the global total, it is difficult to rationalise thistwitchiness. As we mentioned previously, investors (particularly thosethat are geared) are well aware that they have good profits on paperand are edging ever closer to the exit. Yet the institutions in thiscrowd don’t want to be seen to sell ahead of their peers – the risk ofridicule and redundancy is a powerful motivator.This twitchiness might also arise from a sense that where go Chinesestocks goes the Chinese economy, a key underpin for robust globalgrowth in recent years. Yet Chinese investors still have 95% of theirfinancial assets ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

All material on this website is protected by copyright. You may use Information retrieved from the www.scsw.co.uk website for your own personal non-commercial use which means that you may not sell or copy this information to any third party without prior written consent. ISSN 1358-183X

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