There is a lot of interest on BBSFF now, once a darling of yield lovers. Here is a review from The Edge this week.
BBSFF - This much-neglected fund came to life last month in the most unwelcome manner - a price collapse. Much of htis has to do with its parent's business model and sentiment surrounding listed infrastructure funds in Australia, which are all in decline. BBSFF has been tending down ever since the subprime crisis broke last year. How much further can prices fall or have they bottomed? There is no easy answer. Going by the charts, it doesn't look like the decline is over. As for target, it's difficult to say. Prices have fallen from the IPO prise of $1.06 to 26.5 cents, so it's fair to assume the largest decline is over.
Is it? Let's read on.....
The comment from The Edge stop as abovementioned. As a gender reminder, we shall carefully look at what was cited as "the largest decline is over". This statement does not imply that the stock will not decline in large amount again. Good to remember: A stock that drop 90% is first drop to 80% and then half, i.e: Do not assume that it is safe to enter when it drop from $1.xx to 2x cents now, it can cut 50%of your invested capital really fast.
For those laughing at people entered at $1xx, yes, they are suffering 80% of lost right now. If you intend to bottom fish now and it happen to drop another half from current level, then you will suffer 50% lost, and the former 90%. The risk is very high. Therefore, do not enter if no reversal or bottoming signal.
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