Foolish Stock Holders

I remember a couple of years back when Telia Sonera, a Swedish “people stock” made their debut on the stock market. IPO price was somewhere around 85 sek. Now the stock has been bidded for, guess the price? 62.50 sek. More and half a decade has passed and the return minus inflation is way negative.

Sweden ranks very high when it comes to stock owners per capita. But it’s very important to mention that far higher then 50% of all Swedish Stock Holders owns either Ericsson or Telia Sonera, they both don’t create any share holder wealth whatsoever. I think we need a real definition of an investor, so we can really know how many people belongs to the investor class.

Here’s my defintion of an stock investor:

- Invests in Individual Stocks not funds.

- Don’t have 100% in one stock or several large cap companies such as Ericsson.

- At least have a return as good as the general index.

Amount of money in the stock market doesn’t really matter, the “style” is more important.

 Final comment: Close to a million swedes bought Telia at 85 sek in its IPO 2000. That’s alot of people buying a bad government stock, considering that there is only 9 million inhabitants over here!

DN

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