Thanks for your thoughts, Loki. Well, WGX have doubled this year. And looking at their price history, it’s not the first time they’ve halved in value first and come straight back. These goldies are subject to wild swings and get overbought then oversold as sentiment turns on a dime. There’s a Bernard Fanning song with the line “every time we think we’ve hit the bottom, we still find a way further down” - I keep trying to remind myself of this whenever I throw money at goldies I think must surely have bottomed! It’s also a good reason I’m not brave enough to short, at least when you’re long and wrong, you can cling on and average down, rather than lock in losses with a stop-loss.
I think DCN will turn around in WGX fashion. I found their forum was too much like hard work wading through so just put every poster who claimed imminent backrupcy on immediate ignore, cut reading time by about 90%! So much nonsense and drivel getting posted there, even one poster claiming the company’s hedge mechanism was a gamble on the futures market and they now had to cough up the upside difference and the administrators were kicking down the door - utter claptrap! Well, some posters were reading WGX the last rights here at Xmas too. Just glad WGX forum only ever had a handful of posters, not sure why that is?
Anyway, think WGX was approaching fair value, mgmt seem to have done a great job for the faithful, and the POG should now give the SP some extra legs.
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It’s also a good reason I’m not brave enough to short, at least when you’re long and wrong, you can cling on and average down, rather than lock in losses with a stop-loss.
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