Invisible Assets

The temporary loss of a pair of reading specs will be a familiar problem to many: having served their purpose they are often put aside thoughtlessly so that finding them later can escalate into a deductive process involving relatives, friends, strangers - even pets. When my favourite pair went missing recently they were discovered the next day at the house of friends I had visited - which was inconvenient but not crucial because, like others before me, I have built up a stash of spares to cope with this recurring behaviour.

I fished out a pair bought some time ago at Milan airport where, attracted to the stylish shape of the lenses and the chic transparency of the frames, I succumbed to the hypnotic aura of the retail mall. Their style, as it turns out, trumps their functionality and I don't use them often because they are invisible. I don't mean like in a comic book where they render the user invisible: I mean they cannot be seen because they are made entirely of transparent plastic and, chameleon-like, they disappear into whatever background they are placed upon, thereby compounding the difficulty of finding them. I did find them yesterday by re-tracing my movements, returning to the sofa where I had settled with the newspaper to read the business pages.

With the end of the financial year approaching, I was preparing to review what's left of my ravaged investments by checking if the pundits had any stock market tips for me. Ten years ago I read a 'how to' book about acquiring wealth and I remember the salient advice was to "buy assets" - not with one's own money but with borrowed capital. Once upon a time this was easy to do, but in 2008 it all came to an end when solid 18th Century banking principles re-asserted themselves and the dominoes toppled. That was the end of borrowing from banks to buy profit-generating assets. What to do?

It is not advisable to leave spare money, if you have any, in a savings account. Apart from derisory interest rates there is now the danger of confiscation - as Cypriots currently anticipating the arrival of gangs of sinister Russians have just discovered. It seems the only place left where you can put your capital to work is the stock market, where you might profit from the constant movement in share values. You can buy and sell shares yourself or, if you prefer, appoint a manager to do it for you. If you choose the latter, however, be aware that someone else is placing bets with your money.

Preferring to do it myself, I pressed on with my sofa-based research, wrestling with the intricacies of a system that has, over hundreds of years, complicated the simple principles of buying and selling to a point of incomprehension. For example there is a practice, known as 'shorting', whereby you borrow shares in the confidence that their value is about to fall: you immediately sell them, buy them back later at the lowered value and return them to the lender having pocketed the profit. It's clever but tricky - unless you know a) which stocks are about to fall and b) someone who will lend you their shares. Since I know neither I have decided to keep it simple and buy in hope of rising value.

There are other pitfalls, however. Before I got to the hot tips I was diverted by an article describing how the use of computers has made share trading more accessible to amateurs like me. But professionals also use them, and their systems can automatically review market trends, pick stocks and execute trades in one millionth of a second. Which means that - even if I could make a confident, informed decision - by the time I've found my invisible specs, I'm toast. It would all be much less stressful if it was someone else’s money.