Private Investor: I've broken my golden rule and taken a flight of fancy

Don't try this at home, as they say, but last week I bought some shares without doing much in the way of homework.

I know, I know. Ideally you should immerse yourself in your company, assess its standing in the sector, look at what the analysts are saying about it (take their advice with a pinch of salt) examine the ratios and then, after a time simply watching the stock, choose your moment carefully.

There are little things you can do to enhance the stock-picking process. With many companies you can try to visit the place they trade, try their service, buy their goods, see how they perform. How many Marks & Spencer shareholders, for example, a few years ago noticed that their favourite shop wasn't quite as busy as it ought to be or carrying the right sort of stock? How many, more to the point, recognised that before the shares tanked? How many (like me) chose to ignore the signs and hold the shares anyway, hoping our experience was atypical?

What you're not supposed to do when you're investing is just read a few fragments in the papers and then jump in. Yet this is precisely what I have done in he case of QinetiQ.

I had a slight idea of what they were about; the former British defence research establishment responsible for all sorts of clever inventions, then the subject of some controversy since it was partly sold off by the Government to the Carlyle group, and now coming to the market. I also knew that the Government had set its face against a "Thatcher-style" privatisation of the sort we remember from the 1980s, with "Sid" ads and all that. Perhaps that was a bit too Tory even for Tony.

The main point of taking part in those early privatisations - especially before they made multiple applications illegal - was to simply "stag" the shares. That is, cash in on what was an almost certain chance of a profit - no matter that this may have been at the taxpayers' collective expense or that you might have had political doubts about what was being done. The point was that if they (the wicked Tories) were going to sell your assets off at a song at least you ought to be able to make something out of it, that is as well as the chaps in red braces and Porsches.

Those were they days. Are they back, albeit in a muted, lower-key form?

Thanks to financial services companies such as Hargreaves Lansdown (who sent me e-mails alerting me to the possibility of buying shares in QinetiQ) they could be. The broker organised a sort of bulk buying of the shares and was able to compete on the same basis as the traditional big institutional players as the shares were dished out.

Things are looking promising. With an issue that's perhaps 20 times oversubscribed and with the price of QinetiQ shares around 218p to 225p the early market seems set to be considerably higher than the target price range set by advisers at the outset of the privatisation process - 165p to 205p. So not a 1980s style bonanza, but respectable enough.

It's still a fairly bewildering process, however. Although I knew the amount of cash I've committed, which is fixed and paid up front to the broker, I had little idea before the end of the week about how much the shares were going to cost me, how the applications might be scaled back and what I might make out of the exercise.

I'm inclined to stick with the shares, although there again there is a certain amount of uncertainty. A business such as QinetiQ is very hard to value, even for the professionals.

However, I can't disguise the fact that I've done less research on QinetiQ than I have on many more trivial purchases through eBay. Which reminds me, I really ought to think about buying into them.

Independent Partners; request a free guide on NISAs from Hargreaves Lansdown

News
Alan Bennett has criticised the “repellent” reality shows which dominate our screens
tvBut he does like Stewart Lee
Life and Style
The Google Doodle celebrating the start of the first day of autumn, 2014.
tech
Arts and Entertainment
Sheridan Smith as Cilla Black and Ed Stoppard as her manager Brian Epstein
tvCilla Episode 2 review: Grit under the glamour in part two of biopic series starring Sheridan Smith
Sport
David Moyes and Louis van Gaal
football
PROMOTED VIDEO
News
i100
Life and Style
Vote with your wallet: the app can help shoppers feel more informed about items on sale
lifeNew app reveals political leanings of food companies
News
Former Governor of Alaska Sarah Palin, left, with her daughter, Bristol
newsShe's 'proud' of eldest daughter, who 'punched host in the face'
Sport
New Zealand fly-half Aaron Cruden pictured in The Zookeeper's Son on a late-night drinking session
rugby
Arts and Entertainment
Salmond told a Scottish television chat show in 2001that he would also sit in front of a mirror and say things like,
tvCelebrity Trekkies from Alex Salmond to Barack Obama
Life and Style
Carol O'Brien, whose son Rob suffered many years of depression
healthOne mother's story of how London charity Maytree helped her son with his depression
Arts and Entertainment
The cover of Dark Side of the Moon
musicCan 'The Endless River' carry on the tradition? See for yourself
Life and Style
food + drink
News
Rob Merrick's Lobby Journalists were playing Ed Balls' Labour Party MPs. The match is an annual event which takes place ahead of the opening of the party conference
newsRob Merrick insistes 'Ed will be hurting much more than me'
News
A cabin crew member photographed the devastation after one flight
news
Voices
A new app has been launched that enables people to have a cuddle from a stranger
voicesMaybe the new app will make it more normal to reach out to strangers
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Trainee / Experienced Recruitment Consultants

    £20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...

    Trainee Recruitment Consultant - Soho

    £20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...

    Trainee Recruitment Consultants - Banking & Finance

    £20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

    Quantitative Risk Manager

    Up to £80000: Saxton Leigh: My client, a large commodities broker, is looking ...

    Day In a Page

    Secret politics of the weekly shop

    The politics of the weekly shop

    New app reveals political leanings of food companies
    Beam me up, Scottie!

    Beam me up, Scottie!

    Celebrity Trekkies from Alex Salmond to Barack Obama
    Beware Wet Paint: The ICA's latest ambitious exhibition

    Beware Wet Paint

    The ICA's latest ambitious exhibition
    Pink Floyd have produced some of rock's greatest ever album covers

    Pink Floyd have produced some of rock's greatest ever album covers

    Can 'The Endless River' carry on the tradition?
    Sanctuary for the suicidal

    Sanctuary for the suicidal

    One mother's story of how London charity Maytree helped her son with his depression
    A roller-coaster tale from the 'voice of a generation'

    Not That Kind of Girl:

    A roller-coaster tale from 'voice of a generation' Lena Dunham
    London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

    London is not bedlam or a cradle of vice

    In fact it, as much as anywhere, deserves independence
    Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

    Vivienne Westwood 'didn’t want' relationship with McLaren

    Designer 'felt pressured' into going out with Sex Pistols manager
    Jourdan Dunn: Model mother

    Model mother

    Jordan Dunn became one of the best-paid models in the world
    Apple still coolest brand – despite U2 PR disaster

    Apple still the coolest brand

    Despite PR disaster of free U2 album
    Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

    Despite the result, this is the end of the status quo

    Boyd Tonkin on the fall-out from the Scottish referendum
    Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

    Manolo Blahnik: Flats, Englishness, and Mary Beard

    The shoe designer who has been dubbed 'the patron saint of the stiletto'
    The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

    Scrambled eggs and LSD

    Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
    'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

    'Normcore': Blending in is the new standing out

    Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
    Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

    New leading ladies of dance fight back

    How female vocalists are now writing their own hits