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A Contradictory Life

I work at an Auction House?

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God help us if we ever take the theater out of the auction business or anything else. It would be an awfully boring world. - A. Alfred Taubman

On Saturday Anchor Capital (where I work) co-sponsored a cattle auction and I was asked to write something to introduce our business, tied in with an auction theme, that we could have printed on flyers and incorporate into the information packs we distributed. The feedback from my colleagues was encouraging so thought I would re-post it here.

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Juxtaposing an Auction with Anchor 

Records suggest that auctions date as far back as 500 B.C. when women were auctioned off as wives. In fact, it was considered illegal to allow a daughter to be “sold” outside the auction method. The buyer could get refunded if he and his new spouse did not get along well but, unlike a horse, maidens could not be “tried” before auction. Women with special beauty were subject to the most vigorous bidding and the prices paid were high. Owners of the less attractive women had to add dowries or other monetary offers in order to make the sales.

Much of this is true for the trading of shares too: it is unwise to buy and sell shares outside of established markets, one cannot “try” shares out first but can hopefully be refunded at a higher price by selling the shares back into the market if you feel that they do not have the right fit for your portfolio or valuations become inflated, shares with a ‘special beauty’ are often more expensive but come with monetary offers such as dividends or greater growth potential.

Auctions arrived on Western shores in the 1600s during colonisation and this is when the sale of crops, imports clapboard, livestock, tools, tobacco, slaves and entire farms became popular.

During this time, too, the Dutch, British and French governments all gave charters to companies with East India in their names. Sea voyages that brought back goods from the East were extremely risky (Pirates, weather and poor navigation). In order to lessen the risk of a lost ship ruining their fortunes, ship owners sought out investors who would put up money for the voyage – a capital raising if you will for outfitting the ship and crew – in return for a percentage of the proceeds if the voyage was successful.  These early limited liability companies often only lasted for a single voyage after which they would be dissolved and a new one created for the next expedition. Investors responded by diversifying their risk by investing in several different ventures at the same time.

Much in the same way that we hope to be your Anchor in the world of investments, which can be tumultuous if not correctly captained.

During the 1990s, technology was finding its way into the auction business. Auctioneers were using computers, fax machines, cell phones and other technology to make their businesses run faster and more smoothly.

Auctions burst into cyberspace in the middle of the decade. The ever flourishing eBay was launched in 1995 and would go on to become an “online leader” in the bidding business.

Many auctioneers today offer both live and online auctions to meet the needs of customers near and far. Technology allows buyers to participate in the sale without even being there.

Again, there are so many parallels to be drawn here to stock trading.

Over the years auctioneering as well as share trading has progressed and changed, and today it remains more popular than ever. Almost everything thinkable has been sold by the auction method of marketing and by the business acquiring method of share trading: antiques, household items, automobiles, land, livestock, homes, designer dresses, business equipment, and more.

Auctions have been around since the beginning of time because they are a highly efficient and effective business tool and they meet the needs of the public. But, they also are fun, entertaining and theatrical. Most people who attend an auction keep wanting to go back again and again.

If you have never been to an auction, join in and become part of history. We, at Anchor Capital, hope to act as your Auction House by determining which items to be included in your portfolio, registering the bids on market systems, delivering the goods to your winning portfolio and taking care of all the diversification and administration needs.

The word “auction” is derived from the Latin augeō which means “I increase”. Do you want to increase your market knowledge and the value of your portfolio? Contact us. We would love to help.

Anchor Capital