AGM... Top 10..., page-14

I've been pondering as it is a healthy question to ask yourself sometimes. I am a LT investor who is very bullish on LYC, but sometimes it's good to do (repeat) due diligence.

Ultimately, reasons NOT to invest in LYC boils down to two (doomsday) scenarios:

1. China. This point is relevant for both overall demand and pricing. 'Softness' in price during the past ~6 months is largely due to intra-China demand being 'soft' due to regional lockdowns, which ultimately is/has been reflected in the price of the raw materials. If there is an economic meltdown in China it will reflect in REE prices. So, if you believe a meltdown is imminent, I would't recommend investing in LYC.

Mitigating factors: If China would continue the strict zero-covid policy, I have no doubt the economy of China would crumble completely and I would perhaps exit myself. Fortunately, signs are pretty clear now that the leadership (=Xi) has finally come to this realisation and zero-covid seems to have been brushed under the carpet. Also, even if there is a slowdown as the shadow of zero covid hangs over China, the transition to EV/green energy is rapidly accelerating, meaning even if fewer cars are sold (overall) a higher percentage will be EVs (= more PM demand).

2. Malaysia. This is largely linked to getting harassed by the 'terrible three' the past decade. If you believe Anwar is on the same train as those three and will not renew our licence to operate LAMP, then I'd suggest to exit LYC and not get back for a few years.

Mitigating factors: I've mentioned in the 'Malaysian election' thread, Anwar most likely does not pose a threat for LYC. Nor does the terrible three, of which two has been kicked out of parliament, and the third is on the fringes. On the contrary, Anwar is eying economic growth as a key focus - something that LYC may very well benefit from.

For any LYC investor, or prospective investor, I believe these two aspects are worth keeping a close eye on. Perhaps reasons 3-5 can be other doomsday events, e.g. revolutionary new PM technology, wwIII, or alien invasion..

LYC remains my biggest single holding, and personally I see no reason to give up on my wait for $20+ (and a huge tax benefit from being LT).

Happy Friday
All IMO, DYOR