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Friday, 1 December 2017


Investors holding the bag

Oh dear, another so-termed "A1" business of yesteryear goes into voluntary administration, with Deloitte called in to deliver the administrator services. 

Bag business Oroton has become the next in a growing conga line of Australian retailers to collapse, and to be suspended from official quotation.

The group reported a loss of more than $14 million for the last financial year, so it probably doesn't come as a great surprise to the market.

This is sad news.

Oroton is one of Australia's most established retail brands, being founded nearly 80 years ago. 

Stock pickers were strongly recommending investing in these businesses about 7 or 8 years ago, but $1 million invested even after the financial crisis stock market crash would today be worth...

Incredible to think that "A1" businesses - by definition the best investments money can buy, according to the experts - can see investors lose all of their money. 

It boggles the mind to think how risky some of the lower conviction plays must be.

Unfortunately so many retail stocks face the same outcome over the years ahead.

We've already recently seen a range of retail collapses, from Pumpkin Patch to Rhodes & Beckett, Marcs, David Lawrence, Oroton, and Herringbone.

And that's just in the fashion sector.

Elsewhere Foot Locker recently saw it's share price cratering on an epic earnings miss. 

And now Amazon's arrival in Australia will sound the death knell for even more retail stocks. 

Stock market investors in the retail sector are facing absolute carnage, with the retailer now deflator turning negative

Bizarrely, to me at least, some commentators are calling for mythical rate hikes!

Yes, you read that right: retail prices are falling, but we're apparently going to see hikes.

No financial advice is ever to be given on a blog site of course, but those wanting to keep that free spending money rolling in over the festive period and beyond will just keep on fading those rate hike calls!