Buy low, AIM high: The ValueTheMarkets readers’ guide to surviving London’s junior markets

By Richard Mason


share price chart on a downward trajectory investing.

This article was originally published on 15 March 2019

Earlier this week, we asked our Twitter followers for the single best bit of advice they would give to someone investing on AIM. We received a fantastic response of tips and pointers that everyone – from new investors to seasoned professionals – will be able to benefit from.

Below are some of the best pieces of guidance we received on how to maximise your returns in the junior market space. These accounts are very much worth following for regular insights into the market, and please feel free to add any more pieces of advice you may have by replying to the Twitter link to this article:

Doc Holiday (@DDS_DocHoliday) – Have a cooling off period between significant gains or losses to realign ones thoughts.

David Marshall (@RapidDave_uk) – There are relatively few professional analysts who cover AIM & Small Caps & therefore companies often don’t see fair value / potential reflected in their MCap. The majority however are dross. Your job is to #be_the_analyst & find the very few good Co’s that offer multiple returns

Gary Newman (@GaryNTrader) – Look for positive net cash flow and those that are either profitable on a net basis or are approaching that stage – don’t get blinded by large revenue figures as it is all about profit, plus of course real growth

Vilage_idoit (@vilage_idoit) – Take three months out to read extensively and observe price action before placing your first trade. The reality is most people lose trading AIM. So, what will make you so special? It‘s not the answer people want to hear, and it‘s not exciting either. But it will save you money.

Bel (@Belcourtoi) – Start small, Think Big & Believe

Watermelon (@Watermelon_AIM) – Invest small. Observe. Don’t follow the herd. Set up a virtual portfolio. Prepare for the worst-case scenario.

Natali – Trades (@Natali71550945) – Don’t hold oil explorers for results. Don’t hold medical stocks for results. Smart money trades the good news

Geezer (@Horatio_CJ) – Pick an excellently run company and go long with still might lose your investment but it’s the best chance you have got.

Dave Protheroe (@NoiseyDave) – If you estimate a “fair value” for a company and buy it cos it’s cheap don’t expect it to reach the fair value. Take profits before then

Aimgambler (@aimgambler) – Only invest what you can afford to lose, research, research, research until you find the cash cows with no or very little (manageable) debt and take profits at a sensible level, don’t be greedy and expect 50/100% on a trade, it rarely happens!

Nigel Deafsinger (@deafsinger68) – Rein in your own ego. It blinds you.

Calum (@ccail07) – Start trading and learn by doing, but don’t use any more than 10% of your pot so when you mess up, which you will, a lot.. It won’t ruin you.

Toro (@Toro_AIM) – Be cynical. Start small. Don’t rush to buy. Take profits, don’t get greedy. Look for reasons not to invest. Use Twitter for the community and shared research, not for tips. Block anyone who posts ‘boom’! If you get put in a group without asking, you’re already the victim!

Blooms (@bloomtrader) Without proper research it’s like betting on a horse only to find out that you’ve backed a overweight labrador getting ridden by a devious criminal. The Market is a dysfunctional emotional psychopath that feeds on your cash

Stuart Pearson (@Spears07) – Do your own research. Read everything you can in your chosen stock. Ask questions. Look at the catalysts

Thank you to everyone who replied and for the advice you shared.


In this article:

Author: Richard Mason

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

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