substantial shareholders, page-5

Hi Joyce,

Regarding CNP ownership by substantial stock holders:

When companies short term lease out the movement of one of their stocks at a fixed price, they still OWN the underlying stock. Thus there is no need to announce to ASX - they are not selling the stock only the potential movement of that stock. The person buying or selling is only buying/ selling the potential movements, either up or down. Depending on which way they bet - short/ long they can either make money or lose money.

I do it with a lot of my blue chips. For instance currently I have a sum of standard stock units of AAPL Apple Inc in the US. They are sitting at $185, close to the all time high of $203 (not bad for a luxury tech goods maker in the middle of the CC/ recession). This primarily is because of the announcement of the new 3G iPhone next week and also the possibility there will be a cheaper iPhone Nano for the PAYG market announced. This news I believe is already built into the SP. They were $120 in March.

I don't want to sell my shares in AAPL as they are on my long growth/ term investments. I am worried that they could possibly do what they did at the beginning of the year - Tank badly! From $203 - $120. I don't think there is that much potential upside as they are near an all time high in the middle of CC/ recession but they could possibly remain at a similar price.

So I keep my shares in the company, lay a short down with a CFD company for the same amount,
*if it goes down as I expect it to - I have kept my shares and not lost any money,
*if it stays the same - I have kept my shares and not lost any money
*if it goes up I have kept my shares and not lost any money.

There are no gains unfortunately (unless you play around with % levels of your hedging) - but it is a way of protecting your investment from unnecessary volatility, keeping your shares in Centro and waiting for the right time to unhedge them ie - when Centro finally releases some good news and you believe it has some long term upward momentum - NOT spikes. So even though 62% of Centro is held by substantial share holders, believe me they are not suffering the same ever declining SP, they would have hedged there investment, maybe not 100% but by some %.

And no I did not do this with Centro myself - wish I had done now though.