In the end I opted to take a loss on Fielmann as a learning experience. After sagging 3% in November (which I discussed here) the stock slowly gained back its lost value as expected. As 2012 opened and the European crisis ebbed leading to a bull market in German stocks, Fielmann also enjoyed positive gains of around 5% since Jan 1st.  However, this was much slower growth than the index average (9%) and a great deal less than many of my holdings which had posted double-digit rebounds. Even that modest growth could not be sustained unfortunately. When the stock peaked at 80€ a share and then hovered around 79.80 it seemed like a new plateau had been reached.

On February 7th the stock plunged 6 € upon the opening bell on much higher than normal volume for an immediate loss of 8%. Recovery was poor and the stock closed down more than 5% for the day. I could find no news or trading gossip to explain the plunge. I wondered if it was an algorithmic ‘flash crash’.
The next day the stock lurched another 4% a mere hour after opening and languished again, having shed some 10% of value in the space of 2 days on no detectable news.

At this point I decided to pull the plug. This was the 2nd and 3rd high volume, surprise plunge in per share value in 3 months. My stake was modest and even though selling the stock would result in a net 5% loss, I felt that the stock had behaved too erratically for such an expensive issue. Recurring slow building value followed by large high volume sell-offs on an otherwise low volume equity seems suspicious to me.

I ate a modest loss and split the returned funds, reinvesting them in other, less expensive, higher volume shares. I increased my stake in two companies I have been holding on a small scale since late December which have performed very well over the past month. I could have held Fielmann of course, I am sure the stock will return to  the purchase levels over the coming months and will probably pay a dividend in April. However, it seemed to me that the return to break-even price would once again be quite slow. I could likely earn greater returns by putting that money into better performing issues both of which are also scheduled to pay dividends in the spring.

I know I have been very bad about updating the site recently.
This is because it is currently the end of the teaching term/exam period. This demands a great deal of time preparing, administering and then marking exams. I hope to be able to return to more leisurely pursuits very soon.

In the interim, feel free to browse the extensive photography archives: For example: London

cobalisk