risk versus return

Here is the last big jump in MSC's share price. The share price went from 0.6 cents to 1.1 cents. Almost a 100% increase in share price!!! Check out the share price just after December 2009.



Why it occurred? Because debentures got redeemed. The final maturity date of these debentures was 30 September 2009. What do you know, MSC hasn't gone into insolvency.

With a massive $10 million order for 2010 what do the debt holders want?

1. Insolvency - Get a few cents in the dollar of loans.

2. Lend them more money till then get positive cash flows in a few months (2010).

I think the obvious answer is #2. According to the annual report "over $11 million in major new sales contracts have recently been signed". You heard right, SIGNED!!!

Next week I expect a similar announcement to be made!

Risk versus return!

DYOR