I hate that phrase. It's a favourite of rampers when trying to stimulate some buying activity. I put it in the same category as those other favourite phrases of the ramper, "This one's going North!" and "BUY! BUY! BUY!"

So what has this phrase got to do with investment clubs?

Well, it's coming to the time of year when (generally) things turn slightly more bullish. The holiday period is well and truly over and volumes are on the increase. A new year brings new optimism and (generally) the winter months are more productive regarding profits. There is some truth in the old adage "Sell in May and stay away".

This means that currently most club unit valuations will be well off the heady highs of earlier in the year. In a previous article I extolled the virtues of buying in the dips, and unless your club is unfortunate enough to be winding up on or around this time, you could certainly see the spectacular demise of many UK stocks over the past month as a "dip". Maybe more of a plummet, but certainly a dip. If your club portfolio is fairly well balanced then your current valuation should probably be at a low for the year, and possibly the back end of last year too.

So, are things going to improve through the winter? Who knows? I guess anyone with the answer to that one is going to be a rich person indeed. But if your club is just starting out, or at least has a few years left to run, and your club permits the buying of additional units, then perhaps you should consider topping up your club holdings. Buying when the unit value is comparatively low is one way of "insider trading", if you like. You can see what the prices are doing, and if there is a huge correction then a few extra pounds in the monthly holdings could be very rewarding in the long term.

For the record, all of the clubs I am involved in follow the same procedure, which is;

1) A set day of the month is nominated as "valuation day". This is usually at or near the beginning of the month.
2) Throughout the month, share prices can be monitored by all club members.
3) If there is a wild correction downwards (as there would appear to be currently) then there is an opportunity for members to purchase additional units at the previous month's price. This month, across the H&G family clubs, there has so far been a reduction in the unit value by approximately 20%. If this is maintained until the next valuation day, then any additional units purchased benefit from a "discount" of 20% over the previous month, provided of course that the share prices do in fact go back up again.

This is the $64,000 question, isn't it? Will the prices go back up? Well, if your portfolio is well balanced then you should not really have any problems. Even if the "tech" stocks flounder for a while (as I happen to think they will, only a personal opinion of course) then any other good LTB&H stock should outperform the market nicely. Companies like SFI (LSE: SUF), Tesco (LSE: TSCO) and BAA (LSE: BAA) are, in my humble opinion, long overdue for a correction in an upwards direction. Tesco has already put on a bit of a spurt over the last 2 months.

So, if you are in a club which allows you to purchase additional units, then I would strongly suggest you do so. It may well prove extremely beneficial in the long run.

All comments, as usual, to the Investment Clubs discussion board.

Where Next?

• Investment Clubs discussion board
• The Fool's Guide to Investment Clubs
• Fool Books -- The Fool's Guide to Investment Clubs

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