There are two types of penny resource stocks on the ASX:
1)Those that try to create value
2)Those that try to create an illusion of value
Creating value is very hard. You have to drill expensive holes in the ground to try to find a valuable resource. The chances of finding something economical are very slim.
Creating an illusion of value is easy, you just have to fool novice mum and dad investors from the bulletin boards. In this case, all it took was some pretty pictures of rubies on the ASX releases, combined with some vague talk of 'special stones' and the punters were convinced that MUS had the goods.
Now these punters are unable to sell because it is against human nature to admit a mistake and sell at a loss. So they'll keep on averaging down and praying for a miracle to give them a chance to get out at break-even.
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