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It is that time of the year again. Every writer on every newspaper and website is forced into serving up his or her tips of the year. They all dread it. Most are not tipsters. The track record of tips of the year across the board (I should say me included) is not good. None the less we will all go through the same ritual once again. And for some reason these share tips do move markets. I have already had a number of folk in the financial promotion game suggest to me that “wouldn’t x” be a good tip of the year. Generally the answer is no but I patiently say that I will look into it.
It impresses the clients of PR firms if they can somehow extract a favour from a hack and get a stock made into a newspaper tip of the year. This entire exercise is about PRs calling in favours and providing spoon-fed copy to writers who really do not want to stick their neck on the line giving a tip as they are not analysts but reporters. Most of the writers are glad when the whole charade is at an end.
As an investor you should not for a minute (with a few honourable exceptions) think that any great thought or original analysis goes into tips of the year. If you are lucky they tip a stock you own. If it goes up, think about selling and buying back after a few weeks when the PR puffery is at an end Or perhaps not buying back at all.
Whatever you do, do not chase a tip of the year on the day it comes out as Market Makers read newspapers too and adjust prices accordingly. They can see the suckers coming.
I have a few spare days over Christmas and so I have already served up HERE my macroeconomic assumptions and forecasts for 2013. Starting today I will publish my seven share tips for 2013 one a day. Six will appear on financial websites. You can get an alert to them by following me on twitter @tomwinnifrith – the seventh will appear on January 2nd on ADVFN’s new service OneFreesharetip.com – remember to register for that free service here as in the days that follow you will also get a tip of the year from Steve Moore ( ex t1ps.com senior writer), Zak Mir and Clem Chambers
Now, back to work. I quite like writing tips. And I have already seen the Sound of Music a zillion times.
This article first appeared three weeks ago in my Tomograph biweekly newsletter but I felt it merited a wider audience. The Newslettter contains links to all articles of the previous week on the 11 websites which I write for plus special offers, a couple of exclusive articles and ( once a week) a free share tip. Sign up HERE To register for the Tomograph newsletter
