Change in the industry
There are various changes within an industry which can potentially affect the value of investments.
- There might be news specific to the industry of your company. For example, a rise in the cost of commodities (iron, plastics and oil) leads to a reduced demand for cars and thus a fall in share prices.
- Perhaps a complementary product/service has become cheaper which transforms the fortunes of an industry. For example, the falling cost of tablet computers has encouraged greater sales of online games.
- Alternatively, consumers might be abandoning the industry. Today we are witnessing the hollowing out of the retailers of electrical items such as TVs as consumers switch to cheaper prices on the internet. It only takes a loss ...