Bargains appearing on the ASX?

[wrcmad]

As you know, its a common tendency to refrain from buying when stocks dip, but when the prices go up, everyone jumps back on board.

That's because money is made when buying in a rising market, not in a falling market.

Yeah but the trouble when you apply that sort of thinking to spec stocks is that virtually no-one outside the company can really evaluate them. Also it is contrary to having a stop loss, whether mentally or mechanically, because every time the stock falls you buy more instead of the opposite - cutting losses. The selling down of a 'good' stock is not always irrational panic - enough people with enough money to affect the share price might have sniffed what is really going on.

^^ +1 this. Capital preservation, Capital preservation, Capital preservation. Cut losses, don't throw more money away trying to save a bad situation.

 

[Black_Sun]

As you know, its a common tendency to refrain from buying when stocks dip, but when the prices go up, everyone jumps back on board. As Bob Moriarty said on the Gold Report, when the prices start going up and everyone starts buying, this is the time that we'll be selling. And as Rick Rule says, if there's a great stock that you like, and it goes on sale, you should be happy. But most people panic and sell when a sale is occurring. Contrarian advise. James Dines has said the same thing, when prices go down, most people want to rush and sell what they have. But when prices go up, they want to buy more.

Yeah but the trouble when you apply that sort of thinking to spec stocks is that virtually no-one outside the company can really evaluate them. Also it is contrary to having a stop loss, whether mentally or mechanically, because every time the stock falls you buy more instead of the opposite - cutting losses. The selling down of a 'good' stock is not always irrational panic - enough people with enough money to affect the share price might have sniffed what is really going on.

But in this case I think it all had far more to do with the Gold/Silver price and other general factors than specific issues with specific stocks. That's why essentially everything took a dive.

Agreed. Its easy for me to see this, as last year, I looked up EVERY single miner (and Utilities & Energy) on the ASX, and put every single stock into a list, after researching them and finding what their focus was. (NB: So have dozens of lists, most with the max of 35 stocks in each.) OK, so its not 100% up to date now, and also I deleted a few of the US based energy companies, and a couplle of companies where the stock price was about $0.001. On bad days, I look at my "refined" list/s of gold stocks, and 95% of them all go down at the same time, and up at the same time. Its a trend, easily observable. And I don't even use a professional trading platform, which must be much better.

 

[Black_Sun]

^^ +1 this. Capital preservation, Capital preservation, Capital preservation. Cut losses, don't throw more money away trying to save a bad situation.

Disagree that [(stock price down) = (bad situation)].

I think George Soros would disagree as well, seeing as with the recent gold dip he has now increased his stake in GLD by 3-4 times. Why is he loading up as the price goes down? Should he not cut his losses and run?

 

[wrcmad]

......he has now increased his stake ........

Should he not cut his losses and run?

Depends on a number of factors, like intial entry price, allocation, and time frame - Gold is still in an uptrend depending on time frame, so he may be adding to a winning position, not adding to a losing position.

Edit to add: Oh, yeah. Gold is nothing like a speccie stock.

 

[finicky]

Gold and silver are different, lol

 

[Black_Sun]

......he has now increased his stake ........

Should he not cut his losses and run?

Depends on a number of factors, like intial entry price, allocation, and time frame - Gold is still in an uptrend depending on time frame, so he may be adding to a winning position, not adding to a losing position.

Edit to add: Oh, yeah. Gold is nothing like a speccie stock.

Soros is investing in GLD, quite a different animal to investing in physical allocated gold. There is a complex legal structure underlying GLD, which has been discussed by various persons. Completely different to having a pile of gold coins in your safe.

Strange, I thought there would be more contrarians here on SS. But it seems like a case of watch which way the herd runs, and then run the hell for your life in the same direction. And in a bull market, even the shoe shine boy will think he's a stock picking genius. The big commodity investors like Rick Rule, worth over 100 million have told people how to make money in a volatile market. When there is a sale on, you load up the truck, you don't start selling your great juniors, in order to "cut" your losses. We often hear people talking about backing up the truck, but by the sounds of it, here on SS, no-one appears to be doing this, for reasons a, b, and c. And *whatever stock* you're loading up on, is definitely not the right one. Too risky... too speculative... too such & such...

 

[finicky]

Strange, I thought there would be more contrarians here on SS. But it seems like a case of watch which way the herd runs, and then run the hell for your life in the same direction. And in a bull market, even the shoe shine boy will think he's a stock picking genius. The big commodity investors like Rick Rule, worth over 100 million have told people how to make money in a volatile market. When there is a sale on, you load up the truck, you don't start selling your great juniors, in order to "cut" your losses. We often hear people talking about backing up the truck, but by the sounds of it, here on SS, no-one appears to be doing this, for reasons a, b, and c. And *whatever stock* you're loading up on, is definitely not the right one. Too risky... too speculative... too such & such...

The trouble is Black-Sun is there is such a terrible lot of sh*t in the juniour sector of the ASX, especially the gold miners. They are run by scumbags who are allowed to tell the investor anything at all about the future and regularly do. We can cite Rick Rule, Jimbo Dines and so on, but they are very astute guys, capable of asking demanding questions of management and extracting straight answers. They really know something about mining and their particular mines, do you? I don't. We don't know what they are doing - selling into the rallies they generate through their tipster services so they get free carried maybe. We don't know what stocks they are picking - is GOR one of the ones they'd be saying of, "keep loading up on these - the cheaper they get the better?"

Is it 'the herd' that has been selling BHP fairly relentlessly from $50? If so they'd be in a much better situation than the so called 'contrarian' who's been grabbing BHP every time it gets significantly cheaper. If BHP doesn't reverse pretty quick it looks a possibility to head for GFC lows; RIO same.

I don't know what Jim Dines is doing now but last I heard him he was still advocating rare earth stocks and I suspect Arafura (ARU) and Lynas (LYC) have been on his list of must haves. He was also still keen on uranium stocks - how's that going for the holders of PDN, ERA, AGS etc, if someone had generalized his comments to include those particular stocks?

The explorers and developers will continue to get hit the hardest if there really is a capital freeze developing, because holders or potential buyers will fear capital raisings at discounts to already depressed share prices.

 

[wrcmad]

Strange, I thought there would be more contrarians here on SS. But it seems like a case of watch which way the herd runs, and then run the hell for your life in the same direction. And in a bull market, even the shoe shine boy will think he's a stock picking genius. The big commodity investors like Rick Rule, worth over 100 million have told people how to make money in a volatile market. When there is a sale on, you load up the truck, you don't start selling your great juniors, in order to "cut" your losses. We often hear people talking about backing up the truck, but by the sounds of it, here on SS, no-one appears to be doing this, for reasons a, b, and c. And *whatever stock* you're loading up on, is definitely not the right one. Too risky... too speculative... too such & such...

I reckon you're right. Contrarian philosophy is a common 'I'm gunna.....". But people seem to freeze when the prices slump. This is fairly evident even in the stacker sales forums here.

I am not at all a contrarian in the stock markets - the trend is your friend. Better to take a slice out of a rise, than try and pick the bottom, then try again, then add more to the position etc. etc. Maybe I'm a crap bottom picker!

Each to their own. If it works for you, then stick to it.

 

[Black_Sun]

Most of the junior sector is crap, "a complete disaster" according to Rick Rule's latest'. Both Doug Casey and Rick Rule estimate that 90% of the sector exists solely to keep the management in jobs. But even these guys (the pros) get burnt from time to time. What I know is that GOR has made me more $$ than any other stock I've held, twice. I've brought in tranches before, and then sold the lot all at once, rinse & repeat. So, this is my 3rd time in. GOR on analysis, is not just "another gold stock". Most of Australia's gold has come from WA, and there are 5 belts there, first belt = 10 million oz, 2nd belt = 120 million oz, 3rd belt = 12 million, 4th belt = 25 million. The entire 5th belt is owned 100% by GOR. Previously it was ignored due to geological dating assumptions that were made about it, deemed to be "too young". The geological dating has been proven wrong.

1 million oz in 1% of territory, other 99% not yet explored. I must say this is good enough for me. But even if it was 100 million oz in 1% of the territory, this would still not be good enough for lots of people. Do you know of ANY other gold mine in Australia, at any time in the history of this country, where after only exploring 1% of the territory, they have 1 million oz of gold? I'm no historian, nor geological expert, nor mining expert, etc, but I'd say, this looks pretty damn good.

 

[SilverSanchez]

We're talking about GoldRoad huh?

Ive been following GoldRoad since they were called Elektra Minerals.
They have a resource of over 1 mil ounces

But here is teh real reason why they are a good spec buy... they have high grade. Pure and simple - High Grade kicks arse even when its lower volume of ounces.

If they can find a few more - and say they get up to 2 or 3 million ounces at a high grade - this stock will go balistic ... if they can keep the dilution down that is.

My one problem is this - they generate most of the share price on frequent news from drilling, and have raised capital sometimes at significant discount to market. Are they just going to drill into oblivian or are they planning on developing everything they find?

I hope they have more exit plans than just - develop the mine

if you like GOR have a squizz at BRB as well - look at their project maps

 

[finicky]

What I know is that GOR has made me more $$ than any other stock I've held, twice. I've brought in tranches before, and then sold the lot all at once, rinse & repeat. So, this is my 3rd time in.

Well that's different - you are a trader and have a fundamental conviction regarding the stock. The latter reason is why I added 20,000 shares of Neon Energy today, against the trend, and in complete contradiction of what I have been saying on this thread (but do believe to be generally correct - i.e S.P falls in specs are for taking profits or cutting losses not for backing up the truck) I thought you were a newbie investor.

 

[SilverSanchez]

As for Uranium - anyone seen Bannerman (BMN) lately?

REE and Uranium stocks are still good if you can find a good company.
I own Greenland Minerals (GGG) and Alkane Resources (ALK)
ALK is probably the best REE play on the ASX - mainly because its not an REE company - its a Zirconium mine, with a 60-100year mine life.

If Alkane can move into production and avoid a takeover and make some clever aquisitions - Alkane will be a blue chip stock in a decade.

 

[Black_Sun]

We're talking about GoldRoad huh?

My one problem is this - they generate most of the share price on frequent news from drilling, and have raised capital sometimes at significant discount to market. Are they just going to drill into oblivian or are they planning on developing everything they find?

I hope they have more exit plans than just - develop the mine

Agreed. This concerns me as well. Nevertheless, I believe the stock will ascend again, and descend yet again, so that'll be another sale & buy & sale for me. Hopefully the dilution won't go on too long. I'd like to be a long term holder (ie: when they are producing), if possible.

 

[finicky]

Green green its green they say on the far side of the hill,
Green green im going away to where the grass is greener still

Snicker - well until the crash resumes anyway. One of my favourite local T/A commentators Garry Glover sees the same breakdown from a wedge on the ASX200 and All Ords that has been pointed out here. You can see GG's comments here - just click on his commentary titled, "Are we entering a bear market?", in the portraited menu,16 May 2012, then scroll back and click the start arrow in the video frame:
http://www.finnewsnetwork.com.au/features/Moving-beyond-cautious-optimism.html

Time to mention another quality small cap going cheap, if you accept the Skaffold valuation of $1.68 in FY12 rising to $1.93 in FY13 . I've been slowly accumulating a few, but straight after I finally got filled today @ $1.37.5 the stock dropped another 4%! Goes to show one its vulnerabilities, it's illiquid. So this is a stock that might be attractive to SStkers in that one of its product divisions is top shelf metal detectors, ASX code CDA.
At $1.37.5, trading on roughly P/E of 10 and fully franked yield of 7% based on expected FY12 earnings and payout
http://codan.com.au/

 

[topstock]

Talking about bargains I was telling everyone who was willing listening to jump into NMG when it was 22c about two weeks ago.Fast forward less than two weeks since then they are now 31c. A nice 40% profit.

I have a couple of bargains on my radar that are going to double in value I believe once this volatility is over. Looking forward to letting everyone know once I grab a decent parcel

 

[finicky]

Do you ever think that the ASX might have bottomed? I haven't given it much thought, and have assumed it will have further to go - maybe a lot further. But this guy reckons it bottomed 3 trading days ago = Friday 18 May, at 4079.40 on the All Ords. He thinks the Index could end the year up around 5000! He says he has a March 11, 2009 feeling about his call. This is when he publicly called the bottom of the GFC crash! All this on Peter Switzer last night - he has a big reputation to protect. What if he's right?


"Clifford Bennett - 11 March 2009
Ring the Bell" call on national television for a new grand bull market to last 5-15 years, Dow Jones rallied 100% in first year"
http://whitecranegroup.com.au/

 

[finicky]

But Clifford Bennett reckons it bottomed 3 trading days ago = Friday 18 May, at 4079.40 on the All Ords. He thinks the Index could end the year up around 5000! He says he has a March 11, 2009 feeling about his call.

I'm more inclined to the fresh bearish view of Gary Glover emailed today. He's seeing another leg down after a possible short term rally toward the early to mid May breakdown from rising support. He thinks the downleg will take the All Ords down to the range of 3,600 - 3,300 towards the end of 2012. By his tone he favours the low end of that range, i.e 3,300. That's getting within cooee of the GFC crash which bottomed at 3,091 at what looks to be 06 March 2009. His target, 3,300 - 3,600, is well below the disturbing mini crash of 09 August 2011 which bottomed at 3,829.

http://www.finnewsnetwork.com.au/ar...fternoon_Investor_23_05_2012&utm_medium=email

 

[finicky]

Flight Centre (FLT) having a 'nice' drop today. Nice if you want in, not nice if you're holding. Down 52c at posting but it's only low volume. A move down like this morning's on higher volume would have me confident of further downside that could bring the stock within range for buying.

According to this site, run by ASIC, Flight Centre is one of the more shorted stocks on the ASX running at over 11% of the issued shares being shorted about a week ago. That leaves the question open - is the FLT share price faring badly only because of shorting and the general environment, or is FLT being shorted heavily because the shorters are confident of its business being weak or its share price being over valued?

http://www.asic.gov.au/ShortSell/Sh...tSummary?OpenPage&Start=1&Count=30&Expand=3.1

Reported Daily Short Positions for 21/05/12

Product/ Product Code/ Reported Short Positions/ Total Product in Issue/ % of Total Product in Issue Reported as Short Positions

FLIGHT CENTRE ORDINARY/ FLT/ 11,543,425/ 100,031,742/ 11.54%

 

[finicky]

Why is Seek (SEK) getting pushed by analysts lately?

Skaffold rates it B2, sees no discount in the stock at its current price until you go way out to FY14 earnings, yet Montgomery Investments analyst Russell Muldoon was on Business Channel a few nights ago promoting SEK . Then Ben Clark from TMS Capital gave it a plug, and I've heard one or two others as well..

Its on a growth P/E of 18.5 and puny yield of 2.4%. Most stocks like that have been hit particularly heavily lately.

Then out comes the news on Tuesday that SEK is expanding its ownership level in two employment related websites in Brazil and Mexico.

Then comes news today that James Packer's investment company has raised its equity in SEK to 4.9%.

I don't get what they like so much about with this company. The chart of SEK is unreadable to me too - it looks ambiguous.

 

[JulieW]

Would someone like to do a Shares 101 course, like NR's Property 101.
How to buy, how to sell, what all the in-words mean.
I know nothing about this topic and I'd like to learn.