Last week was certainly a depressing one for stock market investors. My portfolio was down substantially even taking into account the last-minute announcement on Friday of an agreed takeover bid for EMIS Group (EMIS).
This is a cash offer of 1,925p which is a premium of almost 50% to the recent trading price so is surely likely to be accepted. EMIS is one of my longer-term holdings – first purchased at 485p in 2011, but it has been somewhat disappointing. Overall total return has been 12.7% per annum including the latest bid premium but with a strong position in the supply of medical solutions they should surely have been making big profits in the recent pandemic and in the support of the NHS where large amounts of money are being spent. I think the big problem has been having the Government as a major customer who tend to dictate the pricing.
I did buy a few more shares recently at 1,272p but failed to have the courage of my convictions and should have bought more. Like many investors no doubt, I have gone on a buying strike and am selling as the market trends down rather than buying.
My capital gains tax charge for last year is only moderate but with holdings in Ideagen and EMIS soon to be realised I will be paying a big bill this year. Capital gains tax should be indexed now that inflation is reaching 10%. I will be paying tax on fictitious, not real, gains.
Perhaps ShareSoc should be taking up that issue.
Will the market improve over the summer? I doubt it until there is better news on the economic front. We appear to be heading into a worldwide recession prompted by higher commodity prices. There may be some share bargains appear in the next few weeks but I personally won’t be rushing back into the market.
Meanwhile I am at least out of hospital but have written to the Chairman of the local NHS Trust to complain about the dysfunctional management and waste of resources. There is lots of money being spent on the NHS but the patient experience is still crap.
Roger Lawson (Twitter: https://twitter.com/RogerWLawson )
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