announcement, page-21

Hello Sava,

"On UMC I am still intrigued with the stock. There seems to be a core of posters who are very confident on UMCs prospects and that is very good for the stock."

Yup, we constantly pick the company apart.
All the juniors have their own particular risk associated with them. You need to identify them, and analyse them. e.g. PLVs plunging resource on a pristine island and lack of liquidity, AGO's gazillion unlisted options (yes that is a number), GBG's accidental loss of major equity partner.

"But I do note that the stock sp does not appear to be meeting the lofty expectations of those posters. From reading the posts I have not been able to identify what is holding this stock back but maybe it is due to my lack of knowledge and there are very good reasons for this."

RIO - Producer - down 36%
MGX - Producer - down 51%
MMX - Producer - down 68%
GBG - near term magnetite - down 57%
AGO - near term producer - down 59%
POL - range of targets - down 58%
BRM - large cash reserves - down 67%
GIR - large target - 65%
FMS - large director - Down 60%
FRS - Down 68%
GDA - Down 90%
UMC - Down 50%

So Apart from RIO - UMC has held up the best.
There are other companies I didn't mention, but I think you get the picture.

Clearly IO has been out of favour - probably out of fear of a Chinese slowdown.

"I very nearly bought UMC at its recent lows and given the move in sp I wish I had done so. What held me back is the fact that I have not been able to pin down why the stock appears to be held back."

I think what we'll see longer term is poorer quality stocks continue to slide (with the ocassional 2-3 day dead cat bounce - see VCR, CMQ, LUM, GDN for examples of dead cat bounces), and the better quality plays hold up, and eventually recover. When things recover is anybody's guess. There has certainly been a large amount of new trading volume come into UMC lately.

"Is there in adverse surprise in the wind."
Yeah there is - now that the location of the IO has been disclosed by the company - and seeing as how its so close to a road - it could be possible that one night somebody and stole all 110 million tonnes of iron ore and loaded it on to a fleet of indonesian fishing boats.

"Posters appear to have a direct contact relationship with company management"
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It's amazing what Telstra has achieved Australia wide. Even in the small outback town of Perth we have a phone box next to the Servo. When we're out of cash fingermark whistles down receiver to trick the exchange into giving us free calls.


Joel