Shorting is all within the law, so you can't call it organised crime ... but it's organised something which seems like it should be a crime.
Shorting is just another tool for the market makers/manipulators to control the market.
You can take all the antitrust measures you want but nothing will stop them, it's human nature ... we do have considerable biological similarities to rats, afterall ... all of us.
However, it does enable ... ahem ...
"price discovery".
When ya think of the days of blue sky mining and the likes of Poseidon in 1969, when its SP raced from 80c to $12.30 in less than a month, before racing to $280 a couple of months later (one UK broker announced a target price of $382) ...
perhaps shorting does have its place.
The blue sky mining days were such that good grades depended on how much alcohol you could ply your Geologist with to get him to sign off on assay results. Poseidon failed because the nickel grades were lower than originally thought. Are there any miners today relying on Geologists' reports from 60/70 years ago? Not PLS, that's for sure.
In the sharetrading forest, it's often hard to see the wood for all the wolves.
Y'know, PLS can stay at 88c per share, for all I care.
When PLS is making over one billion AUD per year, it could
theoretically pay dividends of 60c per share.
Can you imagine getting a 60c dividend per year on an asset worth 88c? That's 86c
grossed up for tax. Almost 100% gross return. Hello.
The SP should compensate X10 to adjust the ROI back to 10% say.
Doesn't matter if its 60c
grossed up for tax purposes.
where are you going to find an asset to invest it in that offers you a 68%pa gross return? You could invest in some Bonds and get a better return. They're called junk Bonds and the return is based on the risk of default ... very bloody high.
I know there's still a lotta risk here. We don't even know if plant and process will work.
However, I don't know any other Oz hard rocker that has gone to PLS's lengths to derisk. The success of TAW and AJM, is very encouraging.
What's an appropriate return for this asset
now given the level of risk? 68%? 100%? ... I don't think so. Only investments that involve sovereign risk offer these types of returns ... and often justify it.
As soon as plant and process are up and running, what is the level of risk
then with PLS?
We've done the "up" ... and now for the "running" ... and soon it will be ...
"ok, here we gooooo" ...
www.youtube.com/watch?v=oxHoLtrGNCA
I'm all in since 38.5c and still sitting pat. Only 2 more months til my cgt anniversary. woo hoo.
(20min delay)