Take steps to avoid your portfolio doing “a Valerie”

How can you prevent a disaster like Patisserie Valerie’s share suspension from ruining your portfolio?

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Patisserie Valerie: £20m of missing dough
(Image credit: 2011 Getty Images)

You could be forgiven for feeling a bit queasy about checking your portfolio right now, given the volatility of recent weeks (see page 6). But spare a thought for Patisserie Valerie's shareholders. The cake-shop chain took investors by surprise last week when trading in its shares was suspended. The group revealed a £20m hole in its accounts, swiftly followed by an emergency rights issue (see page 8). That has kept it afloat, but when the shares start trading again investors may be looking at paper losses of 80%-90% compared with the pre-scandal closing price.

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John Stepek

John Stepek is a senior reporter at Bloomberg News and a former editor of MoneyWeek magazine. He graduated from Strathclyde University with a degree in psychology in 1996 and has always been fascinated by the gap between the way the market works in theory and the way it works in practice, and by how our deep-rooted instincts work against our best interests as investors.

He started out in journalism by writing articles about the specific business challenges facing family firms. In 2003, he took a job on the finance desk of Teletext, where he spent two years covering the markets and breaking financial news.

His work has been published in Families in Business, Shares magazine, Spear's Magazine, The Sunday Times, and The Spectator among others. He has also appeared as an expert commentator on BBC Radio 4's Today programme, BBC Radio Scotland, Newsnight, Daily Politics and Bloomberg. His first book, on contrarian investing, The Sceptical Investor, was released in March 2019. You can follow John on Twitter at @john_stepek.