As for y'day 17 Apr 2013 : AGO was the 2nd most shorted stock on ASX - 0.7% of market cap was shorted; 1st on list was BLY : 1.5% was short sold : http://www.asx.com.au/data/shortsell.txt
No wonder both stocks dived today.
But as for AGO (unlike BLY): AGO's fundamentals are excellent, company is growing, iron ore price is stable and high, and most likely will stay WELL above AGO's FOB of ~$50. At current levels AGO earns net of ~$80 / tonne ie profit margin is really exceptional. Compare this margin to loss or near break even for most Gold, Silver, Nickel and Copper miners !
So if you want to stop sell that's fine but be prepared that one day AGO might as well open 10...15% higher than it had closed.
What puzzles me though is WHY shorters decided to short AGO at all ? And why they succeeded ... The only reason is probably the lack of confidence in this stock among investors.
AGO Price at posting:
86.0¢ Sentiment: LT Buy Disclosure: Held
