Selling Portmeirion Group PLC (LON:PMP) (Ripping off a Band-Aid)

No sooner had I implemented my quantitative strategy than one of the stocks purchased under the plan issued a profit warning. Portmeirion Group PLC (LON:PMP), the branded pottery provider, yesterday announced that profits will be well behind analysts estimates this year. The news comes four months into the financial year and so the potential for further shareholder disappointment is big. I sold on open for a pinching 23.1% loss in just a week.

It is my policy (hardly unique) to sell stocks that issue profit warnings. As the old trading adage goes, "the first downgrade is rarely the last" and, regardless of whether it is or not, doghouse stocks almost never go up straight away following the initial plunge on dashed expectations. Rather than waiting a year (typically) for the market to re-embrace the perpetrating security, I prefer to explore fresh ideas offering more immediate financial gratification.

I liken this approach to ripping off a plaster (sorry, band-aid).