Aiding the Investor
Finance
FROM the correspondence I receive front time to time from readers of The Spectator I gather that a good many readers of these financial- columns would consider it helpful if occasionally direct recommendations were made as tO, the purchase of certain shares or stocks. :Some of these-suggestions,-I am inclined to think, come from those who are habitually looking out for 'opportunities for adding to income or capital by acquiring shares likely to have a qUick improvement in market-prices. In other cases, however,--there is no doubt that the desire is ex- pressed by small investors who really feel in need of guidance as to directions in which they may invest their ravings, and this need has, no doubt, ,become the more pressing by reason of the effect of the inroads made upon income by high taxation, increased costs .of living and, in many instances during recent years, by existing invest- ments having been converted into securities carrying ' lower rates of interest.
DANGEROUS " TIPS."
So far as the first group of these enquirers is concerned, I am afraid I do not see my way to meet their require- ments. Quite apart from disinclination to adopt the role of prophet in professing to foresee the immediate course of price movements in particular securities, so many of those desiring this kind of advice are frequently tempted to purchase far more shares than they are able to take up with their own money, and by so doing court the fate which seems inevitably to overtake the weak operator.
And while I may regret my inability to be the means of aiding some reader to the acquirement of a fortune through recommendations of shares likely to rise, I should grieve still more if, through an error in such recommen- dations or through the simple misfortune of being unable to foresee developments completely counteracting the influences expected to bring about a rise in particular shares, a reader were to suffer some grievous loss of capital. It is, of course, not infrequently possible to write freely of certain tendencies calculated to affect favourably or un- favourably certain groups of stocks in the mass, such, for example, as the influences now favourably affecting prior charge stocks of some of the English Railways and to which I drew attention some time ago in these columns, but it is quite a different matter to foresee the probable course of movements in one particular security.
THE GENUINE INVESTOR.
Recognising, hoiiever, the position of the genuine investor—that is, one who is seeking for income rather than for mere capital appreciation—it may, perhaps, be helpful if from time to time I were to deal with stocks ofs shares of particular companies, simply setting out the earnings over a period of years, giving, of course, the latest figures, with an indication of how far the income and capital of the holder of the Preference and. Ordinary shares, or the Debenture stock, appears to be secured by the financial records of the undertaking. In giving such details, however, at certain intervals, it must not be sup- posed that the mention of a particular company in any way indicates a recommendation to purchase. The particulars given will often be little more than could be obtained from any up-to-date Stock Exchange work of reference, but because these are not always in the posses- sion of the investor, such concise details may, perhaps, be of some use and advantage. And while the mention of such concerns must not be regarded as any recommen- dation to purchase, I think I can also promise that refer-, ence will only be made to what are generally recognised as sound undertakings.
Usually reference will be made to these securities in the adjacent column of smaller type, under the heading of Investment Notes.
ARTHUR W. KIDDY.
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