SINGAPORE (Oct 8): If I’ve learnt anything as an investor over the last few decades, it’s that volatility is not a bad thing if you can keep your head when all about you are losing theirs. Market panics are a great opportunity to buy shares in good companies at bargain prices, while periods of euphoria can be a good time to sell. But taking advantage of this ebb and flow of sentiment often involves a degree of speculation, or trading with incomplete information. And, investors should not complain when bets they make do not pay off.

See: Getting ready for the next chapter of the penny stock saga
See also: Five years after the Penny Stock Crash
Yet, investors should not have to tolerate being presented with information that is untrue or misleading. Public-listed companies ought to ensure announcements they make do not create a false impression in the market. And, regulators ought to speedily investigate every instance of investors possibly having been misled by the manner in which information is presented.

How would boards and regulators know when something has gone wrong? A telltale sign is when shares in a company suffer a sudden slump. Two years ago this month, ISR Capital had garnered a market capitalisation of more than half a billion dollars, amid plans to acquire a rare earths mining concession in Madagascar. A month later, its stock had suffered a massive collapse, from which it has not recovered. Looking back at The Edge Singapore’s reporting on the company over the last two years, the whole episode seems like a reprise of the penny stock saga that gripped the market in October 2013.

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