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Why has the share dropped., page-26

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donnyk01

262 Posts.

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01/11/18

12:19

Post #: 36349992
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Originally posted by Transversal: ↑

You're welcome.

In terms of why anyone (with or without "muscle") would want to short CGF, beside the ongoing RC saga, here are some possible additional “thematic” reasons:

1) Falling stock/property prices will hurt the value of CGF’s Life investment portfolio.
2) Rising yields will lower the value of CGF’s fixed-income assets and increase CGF’s cost of funding.
3) The extension on CIPRs will slow down CGF’s forecast growth path.
4) The arrival of new competitors in the Australian annuity industry will take market share away from CGF and compress margins.

So, there is no shortage of “negatives” that market participants may want to focus on, if they are so inclined.

But, when it comes to deciding whether I want to take the long or the short side of a position, I personally feel that the most important thing is to determine what the current price is already factoring in.

And in the case of CGF my view is that, even under very conservative assumptions, the current Market Cap is more than justified.

Cheers

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Transversal

Are you able to provide some detail on 2?

Are you referring to Australian interest rates or something more international like US interest rates or 10 year treasuries?

Thanks

CGF Price at posting: $10.69 Sentiment: Hold Disclosure: Held
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(20min delay)
Last $6.32		Change -0.195(3.00%)		Mkt cap ! $4.362B

Open	High	Low	Value	Volume
$6.52	$6.56	$6.30	$8.870M	1.381M

Buyers (Bids)

No.	Vol.	Price($)
10	2016	$6.31

Sellers (Offers)

Price($)	Vol.	No.
$6.32	7949	37

View Market Depth

No.	Vol.	Price($)
12	2050	6.310
19	17935	6.300
9	11079	6.290
8	21882	6.280
7	4279	6.270

Price($)	Vol.	No.
6.320	8300	38
6.330	7769	11
6.340	19702	18
6.350	6472	5
6.360	436	1

Last trade - 13.45pm 17/10/2024 (20 minute delay)

CGF (ASX) Chart

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