As Predicted
A week or so ago in my post as promised to GG, I said that investors with a long term horizon could end up being well rewarded but investors/traders with a short term horizon would most probably end up being disappointed, save for an odd 50% here or there.
The responses from yesterday’s news announcement begins to show this unfolding.
Long Term Investors
First, there are those among we long term investors (me included) who liked the announcement for the following reasons :
1. The award of the grant and the resident membership to the Foundation shows the strong political capital that Stans enjoys with the Russians.
2. It’s not a loan so it doesn’t need to be paid back and neither is it an investment so it doesn’t involve shareholder dilution.
One of our main concerns for us long term investors, during the recent situation, has been the possibility of major dilution. This news shows that the management has truly been looking after shareholders’ interest. To the poster that said it’s for only $3.0 Million , it’s not…it’s only 1 of many other grants available to them as quoted here in their PR……”Should the Company resolve its issues with the Government of Kyrgyzstan, grant applications are ready for advancing the technological development of Kutessay II as well.
This now indicates to long term investors that, should there be dilution down the road, it would not be to severe hence increasing the potential value of the share greatly.
This is great news for us with regards to the fundamentals of the company. So since it involves the possible future of the fundamentals of the company, it’s totally understandable for them calling a halt.
Short Term Investors/Traders
In contrast to us, the short-term traders were tremendously disappointed and responded so, some with sarcasm and others with management bashing. You can’t blame them as they are hoping to have news that would move the sp up dramatically with such developments that would ideally happen in a short time frame. What they don’t understand is that solving their problem with the Kyrgs, Russian based developments and then finally production all are going to take time and would not happen under the short time frame they have.
Management
I am grateful that we have a management who have been acting in the sole interest of the company and its shareholders in doing everything they can to develop the true potential of the company and looking after their shareholders’ interests in oppose to a management that works for the main purpose of their Share price movement in the short term…....those would be devious managers who would be more like manipulators than management.
Finally,
Chinvestments
In my earlier post to you, I started by saying “though I like quite a bit of what you say but you see things only as a trader”…….the reason I started like that is that I had appreciated your views as a trader and that is because I’m not one track minded but also have to be aware of some of the benefits of trading and that’s why there are many long term investors who also trade….
However, you decided to be sarcastic when you said “if he did his DD he would have sold at $3.0”…so all I did was answer why I did not sell and show you how one track minded you were…..my mention of Warren Buffet was the easiest and most well known example I could have used to show you the value of just buying and holding companies with long term value…..
However, you chose to respond with a rant with talk about Buffet and only blue chips…etc….I used Buffett as he is the most wide spread known….I could also have used Peter Lynch….etc or even a fantastic fund manager in the Far East named Tan Teng Boo but how much clarity would that give?………then you go on talking about your finance major and lecturing about keeping emotion out of investment but then your post reeks of emotional outburst !....
The SP is as is currently because, as I have posted before, all the retailers that are interested in this stock have already bought (including those who were holding since $3.0 and who I ‘m sure, like me, bought a lot more as it reached its ridiculously levels situation ) and no fund manager of big funds can buy/will buy until all its problems are removed and licenses secured…..…
So we don’t need to thank you short term traders for ‘propping up’ the sp as firstly, we are not bothered about the current and short term levels of the Sp and secondly, on contrary, the only thing that short term traders bring to the table is volatility and actually are a hindrance to the rise of the SP because at the first sign of trouble they sell (as they can’t hold for too long) and when at the first sign of a good rise in SP , they sell again (being oblivious to the long term fundamentals of a stock), thus causing the SP to drop again before it can climb up again……..so actually a stock’s SP would rise better and faster without the presence of short term traders.
I actually am filled with laughter when I see you guys talking about RSIs and other technical tools (ever thought of using candlesticks?) whose current daily volume average $20 K only !!
Seriously, especially with your finance major you should know that the first rule of trading is that the stock should be very liquid in daily trading value !
It speaks volume of the value of your comments when your biggest cheerleader is BAGO !!
Now, I am not trying to be pompous, for if I were trying to be pompous, I would say something like “For a Finance Major you sure show a poor comprehension of what people write about”…..but then again, you’re a Finance major not an English major.
Cheers,
Simon